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GOVERNMENT INFORMATION CENTER 
SAN FRAN RY 

SAN FRANCISCO 
PUBLIC LIBRARY 

REFERENCE 
BOOK 



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HEARING 

SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 

L - 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 



DOCUMENTS DEPT 

MAR S 6 1W2 

SAN FRANCISCO 
PU3.UC ' »nP.AP.V 



WEDNESDAY, FEBRUARY 19, 1992 
1:55 P.M. 



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SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



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STATE CAPITOL 
ROOM 113 



SACRAMENTO, CALIFORNIA 



WEDNESDAY, FEBRUARY 19, 1992 
1:55 P.M. 



Reported by: 



Evelyn J. Mizak 
Shorthand Reporter 



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11 
APPEARANCES 

MEMBERS PRESENT 

SENATOR DAVID ROBERTI, Chairman 

SENATOR WILLIAM CRAVEN, Vice Chairman 

SENATOR ROBERT BEVERLY 

SENATOR NICHOLAS PETRIS 

SENATOR HENRY MELLO 

STAFF PRESENT 
CLIFF BERG, Executive Officer 
PAT WEBB, Committee Secretary 
RICK ROLLENS, Consultant on Bill Referrals 
NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

SENATOR WADIE P. DEDDEH 

WILLIAM E. TAINTER, Director 
Department of Rehabilitation 

JOE XAVIER, Elected Representative 
Vendor Policy Committee 

JOHN V. LOPEZ, Member 

Board of Directors 

California Council of the Blind 

FRED HOUGARDY, Executive Director 

Association of Retarded Citizens of California 



TOM HUMPHRIES, Associate Dean 
-^ San Diego Community College District 



BUDDY ALLRED 

Signing Interpretor for Deaf 



ELIZABETH BACON, Director 
26 Disabled Student Services Program 
San Diego State University 

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STANLEY GREENBERG,Ph.D. , Executive Director 

Wests ide Center for Independent Living 



Ill 

1 APPEARANCES (CONTINUED) 

2 LES TREECE-SINCLAIR, President 
Disabled in State Service 

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RALPH BLACK, President 

4 California Association of Persons with Handicaps 

5 NORMA JEAN VESCOVO, President 

California Foundation for Independent Living Centers 

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KEN SEATON MSEMAJI, President 

7 United Domestic Workers of America 

8 PAUL BORELLI 
Blind Vendor 

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FRANK ROMPAL, Chair 

10 Vendors Organized in Communication and Education (VOICE) 

n ANITA BALDWIN, Executive Director 

San Francisco Lighthouse for the Blind 



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FRANK D. BOREN, Member 
Fish and Game Commission 



14 MARK J. PALMER, Legislative Advocate 
|| Mountain Lion Foundation 

15 Planning and Conservation League 

16 BONNIE F. GUITON, Secretary 
State and Consumer Services Agency 

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LLOYD AUBRY, Director 

18 Department of Industrial Relations 

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19 CHARLES J. REITER, Legislative Director 

State Building and Construction Trades Council of 

20 California 

2i ARNOLD TORRES, Legislative Advocate 

Number of Community-based Latino Organizations 

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DAN CURTIN, Director 

23 California State Council of Carpenters 

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INDEX 



IV 



Page 



Proceedings 



Governor ' s Appointees ; 



William e. tainter, Director 
Department of Rehabilitation 

Introduction by SENATOR WADIE DEDDEH 

Qualifications 

Organization of Comprehensive Service 
Center for Disabled Persons 

First-hand Knowledge and Experience 
with Rehabilitation Process 

Department Lead Agency in Implementation 
of Americans with Disabilities Act 

Commitment to Consumer Participation 

Business Enterprise Program 

Arrangements to Return Exempt Entitlement 
Position to Vendor's Policy Committee 

Independent Living Centers 

Prospect of Budget Reductions 

Possible Closure of Blind Orientation 
Center in Albany 

Restoration of Funds in Budget 

Questions by SENATOR MELLO re: 

Opposition of Blind Vendors 

Resolution 

Request for Testimony from Blind Vendors 

Witness in Opposition: 

JOE XAVIER, Elected Representative 
California Vendors Policy Committee 



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2 Issues in Resolution 12 

3 Weekend Meeting Planned 12 

4 Questions by SENATOR MELLO re: 

5 Remaining Issues to Be Worked Out 12 

Lack of Consultation 12 

Election Process 12 



X Retirement Program 12 



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Date of Election 13 



10 Response by MR. TAINTER 13 

l [ Committee ' s Receipt of Formal 

Response to Resolution 13 

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Suggestion by SENATOR MELLO to Hold 

13 over until Weekend Meeting 14 

14 Discussion 14 

15 Counter Recommendation by CHAIRMAN ROBERTI 15 

1 6 Questions of Witness by SENATOR MELLO re: 

17 Holding Nomination on Floor 16 

18 Questions by SENATOR PETRIS re: 

19 Comment on Complaints by California 
Council of the Blind 17 



Letter in Strong Opposition 17 

Witness with Concerns: 



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JOHN V. LOPEZ, Member 
23 Board of Directors 

California Council of the Blind 18 

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Director's Call on Pending Closure 

25 of Orientation Center for Blind 19 

26 Extention of Thanks to Legislature 19 

27 Statement Claiming that One Rehab. 

Counselor Could Serve All Disabilities 20 

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VI 



2 Need for Specialized Services 20 

3 Hiring of Competent Staff 20 

4 Endorsement of Confirmation 21 

5 Urge Creation of Oversight Committee 21 

6 Questions by SENATOR PETRIS re: 






7 Date of Decision to Endorse 22 

8 Letter Dated February 19, 1992, 

Stating Opposition to Confirmation 22 



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Response by MS. MICHEL 24 

Response by MR. TAINTER 24 



Lack of Communication over Possible 

12 Closure of Orientation Center 25 

13 Position Now of Organization on 

Confirmation 26 



Witnesses in Support; 



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FRED HOUGARDY, Executive Director 

16 Association for Retarded Citizens of California 27 

17 Needs of Developmental Disabilities Community 27 

is TOM HUMPHRIES, Assistant Dean 

San Diego College District and Board Member 

19 Deaf Community Services of San Diego 28 

20 j Goal of Standards of Higher Education 

for Disabled Community 29 

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BETTY BACON, Director 
22 Disabled Student Services Program 

San Diego State University 30 



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STANLEY GREENBERG, Executive Director 
27 Wests ide Center for Independent Living 

Los Angeles 34 

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Involvement in San Diego 31 

Basic Philosophy of Appointee 31 

Creation of Coalitions 32 



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2 Member of California Council of the Blind 34 

3 Commitment to Disability-specific Services 35 

4 Commitment to Consumer Groups 35 

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Disabled in State Service 36 



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Unanimous Endorsement of Confirmation 37 

Involvement of Appointee in DISS 38 

Efforts to Enhance Communication 

between Disability Groups 39 

RALPH BLACK, President 

California Association of Persons with 

Handicaps 40 

Accomplishments of Disability Rights 

Movement 40 

Unemployment or Underemployment of 

Disabled Persons 40 

Consumer Control and Client Participation 41 

Request by SENATOR MELLO to Hold Roll Open 43 



, 7 NORMA JEAN VESCOVO, President 

California Foundation for Independent 

Living Centers 43 



KEN SEATON-MSEMAJI , President 

United Domestic Workers of America 44 

Witnesses in Opposition; 

PAUL BORELLI, Blind Client of DOR 45 



FRANK ROMPEL, JR., Chairperson 
23 Vendors Organized in Commmunication 

and Education (VOICE) 46 

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Lack of Consumer Friendliness to 

25 Blind Vendors 46 

26 Department ' s Lack of Response 

to Written Letters and Phone Calls 47 

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Requests for Application for the 
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Lack of Policy Manuals 48 

Requests by CVPC Delegates for Member 

Addresses 48 

Lack of Due Process in Filing Grievances 

over Election 49 

Lack of Appeal Process 49 

Salary of Exempt Position 50 

Example Where Department Took Away 

Vending Machine Commissions from Blind 

Vendor 51 

Appointee ' s Goal of Higher Education for 

Disabled Contrary to BEP Training Program 52 

Questions by CHAIRMAN ROBERTI re: 

Policy Manual 53 

Questions by SENATOR PETRIS re: 

Historical Lack of Policy Manual 54 

Response by MR. ROMPEL 54 

Provisions of Welfare & Institutions 

Code 55 

Counsel's Opinion on Due Process 55 

Request by MR. ROMPEL to Hold Confirmation 

until after CVPC Meeting 56 

Reponse by CHAIRMAN ROBERTI re: 

Holding Confirmation on Senate Floor 

for Three Weeks 57 

Witness in Support: 

ANITA BALDWIN, Executive Director 

San Francisco Lighthouse for the Blind 57 

Questions by SENATOR PETRIS re: 

Re-authorization of Federal Rehabilitation 

Act of 1973 58 

Department's Involvement 59 



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2 Benefits to Consumer 60 

3 Changes in Program to Provide Tracking 61 

4 Independent Living Center's Computer Program 61 

5 Consumer Unfriendliness to CVPC 62 

6 Lack of Grievance Procedure 63 

7 Right of Vendors to Appeal 64 

8 Motion 65 

9 Committee Action 65 

10 FRANK D. BOREN, Member 

Fish and Game Commission 66 

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22 Motion 71 

23 Committee Action 72 



Qualifications 66 

Original Founder of Southern California 

Chapter of Nature Conservancy 66 

Need to Involve Private Sector 67 

Questions by SENATOR PETRIS re: 

Major Problem of Commission 67 

Massive Exodus of Companies out of 

California Due to Environmental Regulations 68 

Willingness to Give Legislature Guidance 69 

Witness in Support; 

MARK PALMER 

Mountain Lion Foundation 7 



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State and Consumer Services Agency 72 



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Qualifications 72 

Previous Experience 73 

Request by SENATOR PETRIS to Make Motion 74 



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Questions by SENATOR PETRIS re: 

Environmental Protection 75 

Earth Conservation Corps 75 

Impact on President Bush and Consumer 

Affairs 75 

Outreach to Minority Communities 77 

Conflict with Private Sector 78 

Motion 79 

Committee Action 79 



(LLOYD AUBRY, Director 
I department of Industrial Relations 80 



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Qualifications 80 

Background in Labor Law 80 

Former State Labor Commissioner 80 

Added Enforcement Positions 80 

Rewrote Policy and Procedures 

Manual 80 

Funding of Apprenticeship Standards 

Program 81 

Increase in Cal-OSHA Penalties 81 



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Cuts to Division of Workers Compensation 81 



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Actions to Increase Effectiveness of 

Labor Commissioner Despite Cuts 82 

Support for SB 955 and AB 318 83 

Sweeps in Agriculture and Garment Industry 84 

Questions by SENATOR PETRIS re: 

Timely Hearings for Workers Comp. 

Applicants 85 

Comparison to Past History 85 



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2 Witness in Support: 



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CHARLEY REITER, Legislative Director 

State Building and Construction Trades 

Council of California 86 

Monthly Open Forum Meetings with 

Labor and Industry 87 

Apprenticeship Program 87 

Request to Explore Transition of DIR 

to an Expanded Department of Labor 88 

Witness with Concerns: 

ARNOLD TORRES, Advocate 

Various Hispanic Organizations 88 

Series of Articles in Sacramento Bee 

on Plight of Farmworkers 89 

DIR Investigations 90 

Suggestion of Increasing Fees for 

Farm Labor Contractors to Fund 

Investigations 92 

Former Farmworker in Sacramento 92 

Recommendations in Bee Article 93 

Request that Committee Accompany 

Confirmation with Letter Directing 

DIR to Submit a Clear Plan of Action to 

Respond to Bee ' s Recommendations 94 

Service of Appointee on National 

Commmission 95 

Questions by SENATOR PETRIS re: 

Comments on Article Recommendations 96 

Membership on Commission on 

Agricultural Workers 96 

Recommendation to Department of 

Labor to Pursue Greater Records 97 

Steps in Trying to Deal with Farm 

Labor Contractor Problem 97 



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Mail Audits 

Use of 800 Number to Encourage 
Farmworker Calls 

Interagency Task Force 

Need to Have Worker Attempt to 
Identify Employer in Complaint to 
Establish Jurisdiction 

Need for Procedures to be in Writing 

Special Protections for 
Migratory Labor 

Agriculture Sweeps 

In-depth Investigations 

Issue of Housing Addressed by 
Farmworkers Services Coordinating 
Council 

Work with CRLA so Employees of 
Unlicensed Farm Labor Contractors 
Can Obtain Wages 

Exclusion of Farmworkers from Protections 

Need for Increased Effort 

Veto of Bill to Provide Low Interest Loans 
to Farmers to Provide Housing 

Witness in Support: 

DAN CURTIN, Director 

California State Council of Carpenters 

Summation by MR. AUBRY 

Questions by SENATOR PETRIS re: 

Fair Share of Jobs for Women in 
Construction Trades 

Recommendation by SENATOR PETRIS that 
Letter Accompany Confirmation 

Motion 

Committee Action 



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Termination of Proceedings 



ertificate of Reporter 



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P-R-O-C-E-E-D-I-N-G-S 

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— ooOoo — 

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CHAIRMAN ROBERTI: We now have the appointment of Mr. 



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William E. Tainter, Director of the Department of 
Rehabilitation. Please come forward. 

Senator Deddeh is here, and he would also like to say 
a word in favor of the appointment of Mr. Tainter. 

SENATOR DEDDEH: Thank you, Mr. Chairman and Members 
of the Rules Committee. 

In my nine years' career as a Senator, this is the 
second time that I have appeared before this august body on 
behalf of someone about whom I feel very strongly and very 
deeply and respect a great deal. 

Bill Tainter, to me, is a personal friend. Not only 
that he comes from San Diego, but probably one of the most 
qualified persons for the job that the Governor has nominated in 
the Department of Rehab. 

I just want, in a small way or a big way, however you 
want to interpret that, Mr. Chairman and Members, to say to you 
that I've known Mr. Tainter for a long time. He's an extremely 
competent, hard-working, decent, and committed person to do the 
best job he knows on behalf of those who need his help. 

I am here to make that strong recommendation, Mr. 
Chairman, and I hope that my plea to the Committee will be 
seconded and get a five-zip recommendation to the Floor of the 
State Senate. 

With that, I ask permission of the Chair to be 



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excused. 

CHAIRMAN ROBERTI: Thank you very much, Senator, and 
we're going to see you back in a minute or two, or maybe a half 
hour. 



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Mr. Tainter, we'll ask you what we ask all the 

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Governor's appointees, and that is why you feel you are 

7 qualified to maintain this position? 

x MR. TAINTER: Well, first I'd like to see thank you 

9 to Senator Deddeh. I've known the Senator for quite some 

10 time, and he's been very supportive of very significant issues 

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" related to people with disabilities. 

12 Thank you, Mr. Chairman and Members of the Rules 

13 Committee. I appreciate this occasion to tell you a bit about 

14 myself, and more importantly, my plans for the Department of 
l<s Rehabilitation. 

16 First, I am very honored to have been selected by 

17 Governor Wilson to serve as the Director to the Department of 

18 Rehabilitation. The Department represents the vital link 

19 between Calif ornians with disabilities and the state. It 
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20 Assures opportunities and viable options for working and living 

21 independently in the community. 

~ 2 For the past 25 years, I have advocated that persons 



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with disabilities be given the opportunity to have a meaningful 
role in and become contributing members of our society. 

Upon graduating from San Jose State University, I 
organized a comprehensive service center for persons with a wide 
[variety of disabilities. Then, in the mid-70s, I had the good 



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fortune to move to San Diego. During my 15 years there, I 
served as the Executive Director of the Community Service Center 
for the Disabled, an organization run by and for people with 
disabilities . 

Our Center was dedicated to significant community 
change that empowers people with disabilities to lead 
independent lives. The Center's programs service people, 
regardless of their disability, and we served persons with 
physical, mental, sensory and developmental disabilities. The 
Center offered and continues to offer, a comprehensive array of 
services that range from preventing institutionalization to 
seeking meaningful, competitive employment in the community. 

I am a well-known activist for programs and policies 
for people with disabilities at the federal, state and local 
level. This policies and programs enhance the capabilities of 
people with disabilities and create greater opportunities for 
Itheir substantial involvement in the decision-making that 
(affects their lives. 

And, of course, I am a Department of Rehabilitation 
success story. As a former consumer of the Department of 
Rehabilitation's services, I am well acquainted with the 

rehabilitation process. I know the positive impact the 

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Department's educational and training services played in my own 

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life. 

As a person with a life experience of multiple 

(disabilities, I am keenly aware of the positive messages the 

Department of Rehabilitation can put forth about people with 









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disabilities. The Department can and will play a major role in 
improving attitudes towards people with varying disabilities. 
Governor Wilson has designated the Department of 

kehabilitation as the lead agency in the implementation of the 

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(Americans with Disabilities Act. The ADA is a landmark federal 
civil rights legislation for people with disabilities. I take 
that responsibility very seriously. 

At my direction, the Department has developed a 
[comprehensive plan to implement the ADA. The Department will 
work cooperatively and positively with small businesses and 
Imajor corporations throughout the state, as well as with 
disability rights organizations and state and local agencies. 
The ADA will help us heighten awareness of the benefits and 
rewards of the full participation of persons with disabilities 
in our society. 

I strongly favor the involvement of disabled persons 
[[themselves in decisions which directly affect their lives. 
iThat is why I have brought to the Department, and promoted 
within the Department, qualified individuals with disabilities 
who share my belief in self-determination for themselves and 

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their peers. 

This philosophy also translates into a strong 
commitment to consumer participation in shaping the direction of 
the Department. My mission for the Department is to optimize 
lithe use of our vocational rehabilitation programs by 
concentrating on serving those individuals who can most benefit 
from our efforts; individuals who, without our services, could 



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not achieve meaningful roles in our society. 

The Department of Rehabilitation has a responsibility 
to serve Calif ornians with a wide range of disabilities. In 
accordance with federal law, I will continue on increasing the 
services to persons with severe disabilities, including those 
ith physical, mental, sensory and developmental disabilities. 
I will increase outreach efforts to identify presently 
underserved populations that are eligible for help from 
additional federal rehabilitation dollars. 

I plan to continue to develop opportunities for 
persons with developmental disabilities to attain their 
potential for working in the community. Through the expansion 
of additional services leading up to supported employment, the 
Department will provide persons with developmental disabilities 
greater support services to acquire and retain employment in the 
most integrated community settings possible. The Department of 
Rehabilitation has a key role to play in the continuum of 
services for persons with developmental disabilities as spelled 
out in the Lanterman Act . 

I will also increase our efforts to assist consumers 
with career planning and the implementation of long-term 
rehabilitation plans that lead to meaningful careers. Part of 
Ithis assistance to consumers must include effective use of 
assistive technology. I have already taken steps to develop a 
comprehensive state plan for linking people with disabilities 
with useful technology that fosters their independence in the 
home, community and workplace. 



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As I have explained to Senator Mello, I am working 
Very hard to address the numerous problems in the Business 
Enterprise Program. BEP is a federally sponsored rehabilitation 
program in which blind and visually impaired business men and 
women manage food service and other vending facilities in 
government-owned and occupied buildings. 

Vendors and Legislators are quite frustrated with the 
jDepartment, and I must tell you that I understand and share 
their frustrations. For example, the Department is seriously 
tardy in submitting two separate reports to the Legislature. I 
assure you that the first report will arrive on your desks by 
April 1st, and the other by May 29th. 

I and my staff are working on several initiatives to 
improve the BEP program. We have taken steps of late to 
redirect and increase staffing in the program. At long last, we 
are making materials available to vendors in Braille and other 
accessible formats. 

We are developing comprehensive regulations to govern 
the program. It will incorporate procedures for electing vendor 
[representatives to the Vendor Policy Committee in regulations . 
And I will soon be holding meetings with the Director of 
Caltrans on roadside rest stop stands, and the Director of 
General Services on equipment and leasing issues. These are 
just a few of our BEP proposals. 

On a final BEP point, I have made arrangements with 
the Administration to return the exempt entitlement to the 
Vendor's Policy Committee. We will work with the CVPC this 



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weekend to develop a duty statement and selection process to 
fill this position. I hope to work closely with the Policy 
Committee and its staff on further improvements to the BEP 
program . 

Now let me mention our Independent Living Centers . 
lAs you know, independent living is a philosophy, a concept of 
having people with disabilities take greater control over their 
lives. The state's 27 or 28 Independent Living Centers are 
valuable resources for achieving that goal. 

The business of the Department of Rehabilitation is 

to assist people with disabilities obtain employment and live 

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more independently. 

When I first accepted this position, I faced the 

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prospect of reducing the Department's services by up to 25 

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percent. This was a particularly difficult task in that the 
Department is primarily funded by federal vocational 
rehabilitation dollars that must be matched by 25 percent state 
General Funds. For each state dollar cut from our budget, we 
would have lost three federal dollars. 

I was compelled to produce a budget that would reduce 
staffing by more than 450 persons — one out of every four 
Department employees — and reduce consumer services dollars to 
rehabilitation agencies by 25 percent. Those sizable cuts would 
have seriously hurt all programs and services across all 
disabilities . 

Included in this budget reduction plan was a 
comparable cut in funding to agencies serving the blind and 



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visually impaired, with the possible closure of the state-run 
Orientation Center for the Blind in Albany. Closing the OC was 
bn undesirable option, but if we have to do so, we would have 
bade certain that similar services in Northern California were 
■till available, only in a non-residential, less costly way. 

As a result of several discussions I had with him, 
Governor Wilson understood and was troubled by the devastating 
impact these cuts would have had on our constituency. He also 
[decided it was not wise to forego so much federal money by 
[reducing our budget. 

Consequently, state matching funds for the Department 

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Ibf Rehabilitation were restored. Fortunately, our programs and 

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Services were maintained, and there were no staff layoffs. 

And, the Governor's proposed budget reflects a 
continuation of that commitment, including the preservation of 
the Orientation Center for the Blind. 

Although Rehabilitation is one of the smaller 
departments in state government, it provides the most 
significant impact of any department on the lives of persons 
(with disabilities. It alone offers viable options for living 
independently and working competitively within the community. 
Every dollar invested in rehabilitation services is returned in 
tax dollars. 

If I come to the Department with a particular 
perspective, it is that I will encourage individuals with 
disabilities, and organizations representing their interests, to 
assist me. I welcome consumer participation at the Department 



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of Rehabilitation. 

As a person with a disability, I feel that my life 
experiences and those of others with disabilities are critically 
important in assuring that the Department is responsive to 
persons with all disabilities. Quite frankly, based on my 
perception and experiences of other consumers, it is clear to me 
that there s still much work to be done to improve attitudes 
towards people with disabilities. 

What we have discovered in the past few years, and 
especially with the passage of the Americans with Disabilities 
Act, is that working together, we can achieve a great deal in 
improving the lives, the civil rights, and the quality of life 
for persons and Californians with disabilities. 

Thank you, Mr. Chairman and Senators. At this 
point, I'll be happy to answer any questions you might have. 

CHAIRMAN ROBERTI: Yes. 

Are there any questions among the panel here? 
Senator Mello. 

SENATOR MELLO: Mr. Chairman, just very briefly, I 
can't help but be impressed, I'm sure everyone is, with 
Mr. Tainter's commitment and the way he's administered himself 
in this job since he's taken possession. 

He just recently spoke about his own disability, 
which, you know, that allegation of impairment you can look at 
and see visually, but many people can't see our own impairments 
that are probably concealed within our own selves . 

But what I want to point out to the Committee, and 



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il'm sure the Committee did get a copy, the only opposition that 

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I've received are the Blind Vendors that he alluded to. And I 

appreciate Mr. Tainter's frequent meeting with me and other 

representatives from the Blind Vendors. 

They came up with a resolution that was passed 
ijunanimously just last week. And, of course, Monday being a 
holiday, I was trying to give Mr. Tainter some time to respond 
to them so we could get their support. I think their support is 
winnable. 

Just since then, I think, Mr. Tainter announced that 
this exempt position has been okayed by the Administration, that 
you will be filling, you gave a date, sometime around the middle 
of April. I think that's one of the concerns. 

I don't know whether Blind Vendors are going to be 
testifying today. If we had a few more days, I think we'd have 
— we could win their support over. I just don't know. I'm 
looking for some direction here. 

If we could hear some testimony from those there, 
then maybe during the following week, we can have — if we don't 
mind putting it over for a week, we can have it just for vote 
only, and I'm sure the vote would be unanimous, because I'm 
hopeful we can eliminate what remains to be just some concerns 
on the part of the Vendors. 

CHAIRMAN ROBERTI: Why don't we hear from them first, 
and then we'll try to make a decision on how the hearing will 
proceed. 

Is there anyone here — I know there are a number of 



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people in support. However, I think I'm going to digress a 
little bit and hear the people in opposition first, if Mr. 
Tainter doesn't mind too much, to see how serious it is, if it 
can be worked out, if we should put it over; put your 
confirmation over for one week to see if maybe some of the 

roblems could be resolved. If not, we will, of course, hear 
from your supporters, too, Mr. Tainter. 

MR. TAINTER: Thank you. 

CHAIRMAN ROBERTI: Is there anyone here in 
opposition? 

SENATOR MELLO: Mr. Joe Xavier. He's Chairman of the 
Blind Vendors. 

CHAIRMAN ROBERTI: Mr. Xavier, thank you for coming. 
Please formally introduce yourself. 

MR. XAVIER: I am Joe Xavier. 

I'm not the Chairperson, Mr. Mello. I'm an elected 
representative for the delegates of the committee. 

Mr. Chairman, and Committee Members, and Mr. Tainter, 
I regret that I'm here in this position. I would much have 
preferred to be here in a position of support. 

The delegates asked me to come here and present their 
resolution to the Committee Members. 

CHAIRMAN ROBERTI: This is the Blind Vendors? 

MR. XAVIER: This is the Blind Vendors, yes, the 
California Vendors Policy Committee, which is the blind vendors 
under the Business Enterprise Program. 

The issues that we outlined in that resolution were 



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issues of past track record. They were not necessarily issues 



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that are for the future. We looked at the past track record, 
and that's where we came up with the issues on that resolution. 

It's regrettable that we didn't have more time to see 
the responses that I understand Mr. Tainter has made available 
to the issues presented in that resolution. As 
Mr. Tainter stated, we are meeting this weekend. I'm certain 
that the Committee would like to address those issues at that 
time. 

I have not been given a mandate by the Committee to 
make any decisions on their behalf without them meeting, so I'm 
not able to do so. 

SENATOR MELLO: Mr. Chairman, may I ask Mr. Xavier. 

We have copies of the resolution. What are the 
remaining issues, just briefly, that we want to get before the 
Committee and that you feel have to be worked out? 

MR. XAVIER: One of the main issues that the 
resolution pointed out was the lack of consultation with the 
Committee as was proscribed by regulation and law. Those issues 
surfaced; election was one of them; retirement program was 
another, and there were several others, as well as the 
entitlement exempt position that existed. Mr. Tainter 
mentioned the roadside, and that's also related to the issue of 
— consult issue with the Committee and taking — 

SENATOR MELLO: Could we take these one at a time, 
just very briefly. 

Now, I understand the election, the date of the 



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election has been set. Has that been set already? 

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MR. XAVIER: Actually, the election has taken place; 
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jit has been completed. 

According to our bylaws, which the regulations 
recognize, it was to have commenced October 1 and be concluded 
by November 25th of 1990. This was to allow the Committee to be 
in place, to meet at the beginning of 1992. This did not take 
place. The elections were not concluded until the 29th of 
iDecember, and at that time, a third of the districts were not 
represented due to various reasons . 

SENATOR MELLO: So, in talking to Mr. Tainter, that 
has been agreed to, but there will be annual elections. 

MR. TAINTER: The election is completed. 

In your packet is a response to each of the CVPC 
concerns and so on. 

The election was held up for various reasons. I must 
say, I think the primary reason was my efforts in working in the 
budget crisis area, and then, we did bring in a deputy director 
from — who was appointed in September, and that was her highest 
priority. And then we wanted to be certain that the election 
was done in a fair and impartial manner. And I think we have 
the results now that do reflect that level of impartiality. 

The Vendors are now in place, and they'll be holding 
their meeting, I believe, on Friday and Saturday. 

SENATOR MELLO: Perhaps, Mr. Xavier, your group has 
not been -- formally had the responses made by Mr. Tainter to 
your resolution; is that correct? 



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MR. XAVIER: I understand that there was an attempt 
jto get a response to all the delegates as of yesterday. I was 
not able to speak with all of them. They are scattered all over 

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this state. 

The few that I spoke with had either been contacted 

to have them FAXed to them, or had heard them on the 800 number 

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that's available as an information number from the Department. 

However, we're not able to meet in an official 
capacity until this weekend. And so, we have not as a body sat 
down and addressed the issues, no. 

SENATOR MELLO: Mr. Chairman, I think the dilemma 
we're in is either, if we were to take action at this point, we 
would not be given the opportunity of Mr. Tainter and the Blind 
Vendors to formally talk about the exchange and the responses. 
But hopefully, after this weekend meeting, if they find 
satisfaction in his responses and work it out, I'm sure that 
they would be in a mood to find his confirmation, perhaps, very 
positive rather than, at this point — 

CHAIRMAN ROBERTI: Our normal procedure, Senator 
Mello and Mr. Tainter, is that if a Member of the Committee 
requests that an appointment be put over for a week or two 
^/eeks , we defer to the Member's request. 

What is the final date, I would like to ask the 
consultant, for Mr. Tainter to be heard? 

MS. MICHEL: We have time. It's April 3rd. 

SENATOR MELLO: Mr. Chairman, let me point out, I 
certainly don't want to ask for a delay for purposes of just a 



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1 delay. 

I want to ask Mr. Tainter if he would appear to 



concur with this delay to give you some more time to work with 
the Vendors in order to try to garner their support? Would you 
have any objection to a week or two weeks' delay? 

MR. TAINTER: Throughout my career, we have worked 



with consumer groups. That's basically my philosophy, is that 

8 people with disabilities ought to have the maximum involvement 

9 in programs that affect their lives. 

I feel confident that we could work out a situation 
11 with the CVPC where we could, hopefully, reach consensus on a 

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number of the issues that affect their programs. 

13 I don't think necessarily we need to delay the 

14 hearing in order to do that. I mean, you can have my commitment 

15 that we're going to work on that. 

16 SENATOR MELLO: Well, I think that's up to the 

17 Committee. 



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CHAIRMAN ROBERTI: Senator, I will defer to your 
request; however, let me make a counter recommendation. 

We could hold the appointment on the Floor for three 
weeks, more than our normal time, which is usually two weeks, to 
give you a chance to talk to people who have legitimate 
concerns, and at the same time, not to unduly delay Mr. 
Tainter 's appointment, where I sense there is an affirmative 
feeling on the Committee. 

Is that okay with you Senator? 

SENATOR MELLO: Yes. 



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Let me ask Joe here, if that were to take place, in 
other words, if we voted him out today, then if this opposition 
still continues on, if the Committee felt they'd want to take 
another look at perhaps getting some additional -- 

CHAIRMAN ROBERTI : We ' re always free to re-refer the 
appointment, not necessarily with prejudice, but to re-refer the 
appointment back to the Committee. 

SENATOR MELLO: So, Joe, what I think we're 
explaining to you is, the other option would be to put Mr. 
Tainter's appointment out today with the idea that if this 
weekend meeting, or other subsequent meetings, don't appear to 
resolve the differences, then we have the right to re-refer his 
appointment back to the Committee, at which time we could then 
look at any ongoing opposition you may have and try to get them 
Worked out. 

Does that meet with your approval then? 

MR. XAVIER: I think that's a fair situation. 

SENATOR MELLO: With that, Mr. Chairman, I think 
we'll just continue with the hearing. 

CHAIRMAN ROBERTI: Thank you, Senator Mello. 

Thank you, Mr. Xavier. 

MR. XAVIER: That you, the Committee, for your time. 

CHAIRMAN ROBERTI: Senator Petris . 

SENATOR PETRIS: I'm not clear. Are we terminating 
the hearing now? 

CHAIRMAN ROBERTI: No, no. We're going to proceed, 
and if Mr. Tainter's appointment is recommended to the Floor, I 



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Will hold it on the Floor for at least three weeks, more than 
our normal period of time, unless, of course, the opposition is 

removed, in which case we could proceed with more dispatch. 

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SENATOR PETRIS: May I ask some questions? 

CHAIRMAN ROBERTI: Yes. 

Senator Petris has questions, then we'll take support 
witnesses . 

First of all, Mr. Tainter, I had the same reaction as 
Senator Mello when I learned of your appointment. I thought it 
^as terrific, and I'm glad that the governor followed the 
precedent established by Governor Jerry Brown, who never got 
much credit for any of the good things he did, who was the first 
to appoint a disabled person to head the whole Department. 

Since that time, we've received some letters of 
pposition, one of them is the California Council of the Blind. 
I'd like you to comment on their complaints. 

MR. TAINTER: It's my understanding that there are 
representatives from the California Council here today, and I 
believe that we have worked very vigorously in trying to resolve 
whatever kinds of difficulty that we have had in the past with 
the CCB, and I think we've managed to do that. 

SENATOR PETRIS: Then I'd like to have them confirm 
that, because I spent an awful lot of time reading their letter. 
The only thing in the letter is that you did have a meeting with 
them in January, but they claim in the letter that doesn't 
resolve everything. They feel that there's a very strong bias. 

You've done so well in the general disability 



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categories, including your work with Independent Living Centers, 
that they fell you have a very narrow outlook that is limited to 
them, and you're shortchanging the people that have the other 
disability of being blind. And they give several examples. 

Now, if the Council is represented here, perhaps they 
could come forward and shorten this or clarify it. 

MR. TAINTER: I tried to address those issues in my 
opening remarks . 

I think a number of the budget drills we went through 
were going to greatly impact services across the board, and in 
particular, some of the services to the blind. But fortunately, 
we got through that. 

SENATOR PETRIS: They indicate they understand for 
cuts, but they call this obliteration, such as a move to close 
down the Orientation Center, and so forth. 

Maybe we can save time by having this witness speak 
to that. 

Is this Mr. Acosta? 

MR. LOPEZ: No, this is John Lopez. 

Mr. Chairman and Members of the Senate Rules 
jlCommittee, my name is John V. Lopez. I am a member of the Board 
of Directors of the California Council of the Blind. 

The California Council of the Blind is our nation's 
largest statewide organization of the blind with a membership 
numbering in the thousands. 

July 19th, 1991 will be remembered as a day of infamy 
by the blind of this state. On that date, Director Tainter ' s 



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office called to inform us of the pending closure of the 
Orientation Center for the Blind and other programs for the 
blind due to the budget crunch. The Orientation Center for the 
Blind has been in existence for over 41 years. It helps the 
newly blind to adjust to this challenging disability. 

In a later letter to our President, Director Tainter 
informed him that blind people could learn mobility in these — 
in their local communities. Mr. Tainter did not realize that 
the Orientation Center does far more than teach mobility to its 
students. On a 24-hour basis, the Center in Albany helps to 
shape up a newly blinded person's self-esteem about himself. 

Throughout the summer, Mr. Tainter told various blind 
groups that the closure of the Center was a done deal. He told 
us to stop it if we could. 

We believe that it is less than a coincidence that 
Mr. Tainter waited until July 19th, the last day of the summer 
session of the Legislature, to drop his bombshell. However, he 
did not reckon with the energy, enthusiasm, and commitment of 
the blind of California and of the California Council of the 
Blind. He did not count on the good will of our State 
Legislature. Together we were able to save not only the Center, 
but the other worthwhile programs for the blind funded by the 
Department of Rehabilitation. 

The California Council of the Blind today wishes to 
extend its thanks and gratitude to the 70 Legislators who signed 
Senate Joint Resolution 57, which asked the Governor to save the 
Orientation Center for the Blind. Thanks to you, we were 



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successful . 

I first heard Mr. Tainter at our spring convention in 
May of 1991. At that time, he shocked our membership by 
referring to us as segregationists, by calling our services 
segregated programs . 

I can assure this Committee that we are not 
segregationists. Since 1934, the California Council of the 
Blind has been an advocate for civil rights for all disabled 
Americans . 

Mr. Tainter believes in the shake-and-bake method of 
serving disabled Californians . He has made statement claiming 
that a rehabilitation counselor could adequately serve all 
jdisabilities with equal skill. I submit that should Mr. Tainter 
turn to this generic approach, that the disabled community would 
be served by counselors who would be jacks of all trades and 
masters of none. 

The blind will never accept such a generic approach. 
We demand specialized services which will enable us to compete 
in an integrated world. Give us the skills, and we shall be 
productive citizens in this great nations. But give us 
counselors unfamiliar with our true problems, and we are 
destined to sit on the welfare rolls of California. 

After getting our message, Mr. Tainter began to hire 
competent staff who began to listen to our concerns. Brenda 
Primo heads the division which houses the section for the blind 
and is generally doing a fine job. The Director has become 
aware of the need to work more closely with the Program Manager 



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for the Blind because, he himself blind, is the Department's 
greatest expert on blindness. Mr. Tainter has made many promises 
to give the Program Manager for the Blind greater authority so 
that his expertise can be put to better use than in the past. 

In 1981, the blind of California caused to pass 
through the Legislature a law which makes the position of 
Program Manager for the Blind statutory. We trust the Program 
anager for the Blind. 

Throughout the month of January, 1992, the Director 

and our President have been communicating. The Director has 

i 

issued two written communications to our President, making many 

;commitments which, if done, will enhance services for the blind. 

With this background in mind, the California Council 
of the Blind now endorses the confirmation of Mr. William 
Tainter as the Director of the Department of Rehabilitation. We 
do this with one admonition: the blind of California and the 
State Legislature must never allow a Director of the Department 
of Rehabilitation to make the decision to abolish programs for 
the blind in a vacuum. 

When Mr. Tainter dropped his bombshell on us on July 
19th, he had not spoken to the blind community about his 
contemplated actions. Certainly, he did not seek the wisdom of 
the State Legislature. 

I urge the Legislature to create an oversight 
committee which shall force the Director to come to the table 
and at least talk with them before making such drastic decisions 
affecting the lives of the blind of California. This oversight 



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committee could include Legislators and disabled persons, and 
our suggestion should certainly be expanded to include all 
aspects of rehabilitation and to involve representatives of the 
disabled community. 

We are pleased to endorse Mr. Tainter, and we look 
forward to working with him constructively to improve service 
delivery to the blind of California. 

Thank you. 

CHAIRMAN ROBERTI: Thank you very much, Mr. Lopez. ] 
think Senator Petris has a question of you. 

SENATOR PETRIS: Yes, if you don't mind having a 
seat. 

Your group has managed to throw a lot of sand in our 
face and cause a lot of confusion, and I need your help in 
clearing it up. 

When did your group reach the decision to endorse? 

MR. LOPEZ: It has been reached in the last few days 
when our President, Mr. Robert Acosta, received, like I said in 
"my statement, some written letters which offered some 
commitments . 

SENATOR PETRIS: I may call your attention to this 

letter I have from Mr. Acosta dated today. I won't read the 

| 

whole letter, it's very lengthy, but among other things it says 

|i 

on Page 4 — Page 5, excuse me; now we're way down to Page 5, 
and it says: 

"It is for all these reasons, 
and more, that the California 



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Council of the Blind must oppose Mr. 
Tainter *s confirmation as Director 
of Rehabilitation." 
Now, that letter is dated today. It might have been written 
a month ago, but the date is today. 

"Our convention instructed me to do 
so at our November meeting, and 
nothing has occurred since that time 
which can lead to any other 
conclusion. To be sure, Mr. Tainter 
asked for a meeting with us, and we 
did meet on January 13. As usual, 
we were prepared to explain to Mr. 
Tainter what steps he might take to 
begin the process of bringing 
confidence back, and provided him 
with a virtual laundry list of 
options, any one of which would 
indicate a willingness on his part 
to be open to our point of view. " 
Then it goes on to list five steps that he should take, and 
then it goes on to say that none of them is "earth 
shattering", but each one is helpful. And the letter seems 
to indicate none of them has been followed. 

Apparently there's some miscommunication within the 
organization. I don't know what Mr. Acosta would say if he 
were here. I assume that you're speaking with his approval 



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and authorization as the President. 

Can you clarify this for me? 

CHAIRMAN ROBERTI: Mr. Lopez, then I'm going to ask 
the consultant to also speak to the issue. 

MS. MICHEL: It's postdated, Senator Petris . The 
receipt date, we have a receipt date in our file on that 
letter of February 7th. 

SENATOR PETRIS: February 7th? It is dated the 
19th. 

MS. MICHEL: It is dated the 19th, but we received 
it in Rules Committee on February 7th. 

CHAIRMAN ROBERTI: Maybe that's Mr. Lopez's 
recollection, too. 

MR. TAINTER: Senator, I understand that in your 
packet there is a letter from Mr. Acosta that essentially 
talks about some of the issues that we have been working on 
in the last couple of weeks and that we have reached 
consensus on. 

SENATOR PETRIS: We don't have such a letter in our 
particular office; maybe some of the others do. 

Now mind you, I'm not trying to preserve the 
controversy, but the letter is so damaging and so specific 
that I don't understand what happened all of a sudden. 

Now, if it was written on the 7th, then you had a 
bunch of meetings since then, that's fine, and I'm happy to 
hear it. And I'll, of course, yield -- 

MR. TAINTER: My understanding is that we reached 



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an agreement along the lines of what Mr. Lopez has just 
discussed. That's my understanding. 

SENATOR PETRIS: You're commitment — 

MR. TAINTER: That we have reached a consensus on 
those issues that we would address, and that we would expand 
the role of the Program Manager for the Blind, and a number 
of other issues. 

SENATOR PETRIS: That includes, I assume, better 
communication or — 

MR. LOPEZ: Yes, definitely. 

SENATOR PETRIS: — because one of the problems 
they point to in the closing of the Orientation Center, there 
was no meeting whatsoever with the people of the Council, or 
any other others, to assess the impact of a move of that 
kind. It was just announced, period, and it took them by 
surprise. 

But anyway, if you're — 

MR. TAINTER: This was a budget drill that we were 
forced to go through on many occasions to try to compensate 
for the $14 million, and indeed — 

SENATOR PETRIS: The Governor's done some budget 
drills that we haven't taken too kindly to, as you know. So, 
I'm not impressed with a budget drill. 

I want to know who's getting drilled. 

MR. TAINTER: Nobody got drilled in this regard. 

SENATOR PETRIS: Okay. 

Well, Mr. Chairman — 



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MR. TAINTER: It just goes to show you that if the 
Legislature is interested in cutting programs across the 
board, we can't do it with Rehab., because we were proposing 
a $6 million cutback that ultimately led to a quarter of our 
staff being laid off and $30 million cutbacks. 

I mean, there were no desirable options there with 

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those kinds of drills. 

i 

SENATOR PETRIS: Let me ask Mr. Lopez — 

MR. TAINTER: It didn't happen, though. That's the 
important thing. 

SENATOR PETRIS: The organization's position now is 
that you endorse. Does that mean you support him? 

MR. LOPEZ: Yes, we do. 

SENATOR PETRIS: You urge an aye vote on his 
confirmation, and you've worked out your differences? 

MR. LOPEZ: Yes, we did. According to our 
President Acosta, he did talk to Director Tainter and there 
were some things discussed. We were offered some options, 
and obviously, we are happy enough to work with him, and 
happy that he's willing to be a little more flexible. And 
with some reservations, we are willing to go along with that, 
and hopefully, we can work in constructive ways. 

Now, if there's any letters that the Committee must 
have that are available in the California Council, then we'd 
be happy -- in fact, I'll tell our President Acosta to 
immediately mail them to the Committee explaining our change. 

SENATOR PETRIS: Thank you. 



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MR. LOPEZ: You're very welcome. 

MR. TAINTER: Mr. Chairman. 

CHAIRMAN ROBERTI: Thank you again, Mr. Lopez. 

Yes, sir. 

MR. TAINTER: Could I have some of my people come 
up and talk? They're going to have to leave for San Diego 
and so forth. 

CHAIRMAN ROBERTI : Yes . We ' re going to ask for 
witnesses in support of Mr. Tainter ' s confirmation. Please 
come forward. 

MR. HOUGARDY: Mr. Chairman, Members of the 
Committee, my name is Fred Hougardy. I'm the Executive 
Director of the Association for Retarded Citizens of 
California. The ARC of California is the oldest and largest 
group advocating for people with mental retardation and their 
families, as you well know. 

After Governor Wilson's appointment of Mr. Tainter, 
concern was expressed within the developmental disabilities 
community regarding Mr. Tainter 's perceived philosophy and 
attitude about the DD population and its needs and 
priorities. Apparently some of this concern still lingers. 

ARC California, however, believes that Mr. Tainter 
has become sensitized to the needs of the developmental 
disabilities community and his responsibility to these 
consumers as specified by the Lanterman Act. In particular, 
Mr. Tainter has said he supports consumer involvement, which 
we believe is the very foundation of the DD movement. 



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Based on this, ARC California supports his 
nomination and respectfully requests the Committee to confirm 
Mr. Tainter as Director of the Department of Rehabilitation. 

CHAIRMAN ROBERTI: Thank you very much. 

Is there anyone else in support? Please come 
forward. 

MR. HUMPHRIES [through signing interpreter BUDDY 
ALLRED] : Mr. Chairman, Senators, thanks for the opportunity 
for me to speak in support of Bill Tainter. My name is Tom 
Humphries. I'm an Assistant Dean for the San Diego College 
District and Board member of the Deaf Community Services of 
San Diego. 

I'm responsible for services to over 350 deaf 
students and about 300 students with other disabilities. 

I'm also a member and past chair of a large 
community service agency in San Diego, serving several 
thousand hard of hearing people. I am a past member of the 
Board of Directors of the Community Service Center for the 
Disabled, where Bill Tainter was the Director. 

I've known Mr. Tainter for ten years, and I'm 
totally confident in Mr. Tainter ' s ability and his vision. 
He an able administrator. He has vision; his vision of 
independent living has been one that I also share. Mr. 
Tainter does not make value judgments about whether or not a 
person with a disability can be independent. He knows that 
these disabled persons can be, and Mr. Tainter has personally 
done more for — to help people with disabilities to become 



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independent than anyone I know. 

Mr. Tainter does not just theorize and philosophize 
about disabilities, about rehabilitation. He for many years 
has served on the front lines and managed programs, 
advocated, and broken new ground. All of his experience is 
first-hand. I know he is doing and will bring to the job 
practical and real knowledge, and that will go along with his 
commitment and understanding of what people with disabilities 
face in becoming full citizens and taxpayers in California. 
You will not find a Director with more knowledge of what 
people with disabilities go through in our society and what 
their needs and abilities are. 

I am also confident that Mr. Tainter understands 
that people with different disabilities are different, and 
that they will have different goals and different ways of 
reaching those goals. Mr. Tainter understands that when he 
was in San Diego, when he worked as — we worked side by side 
and cooperatively with Deaf Community Services and with the 
deaf community in general. He knows and he supports the 
concept that every disability group knows that is right for 
themselves . 

Mr. Tainter has been an administrator for a few 
months, and he already — and we have already seen that he 
will put the Department of Rehab, on the right course. He 
will be essential to the State of California in the beginning 
of the Americans with Disabilities Act. 

His set goal of standards of higher education for 



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people with bad disabilities is one of the most important 
emphasis I have already heard from the Department of Rehab, 
in eight years . His goal of expanding cooperation between 
the Department of Rehab, and higher education will mean 
greater cost effectiveness and maximum service for many, many 
people with disabilities. 

As a disabled person and as a professional in 
education and social services, I'm excited about Mr. 
Tainter ' s appointment . I strongly encourage your 
confirmation. Thank you for your support. 

I have copies if any of you would like them. If 
you have any questions, I'd like to answer them. 

CHAIRMAN ROBERTI: Are there any questions? 

Thank you very much. 

Other witnesses please come forward. 

MS. BACON: Hello. My name is Betty Bacon. I'm 
from San Diego, and I'm here as an individual who has known 
Bill Tainter for many years, probably more years then we want 
to try to count up right now. 

I've known Bill as a friend, as a colleague, and 
have worked closely with him during the time that he 
established the Independent Living Center in San Diego, as a 
member of his Board of Directors on the founding Board. 

When Bill started the agency, it was a tiny little 
organization with three or four phone lines and a store 
front. And it has grown from that time into perhaps the 
largest Independent Living Center in the state, serving a 



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couple thousand clients a year. 

But that's not all that Bill did in San Diego. He 
was very involved in the community. He established a high 
profile in San Diego, and he used his particular personal 
awareness and his unique presence to bring disabled people 
into the consciousness of a very diverse group of community 
leaders: our city council; our transit authority, and many, 
many others . 

Bill has a basic philosophy that he operates from. 
It's a philosophy, by the way, that I share. He believes 
that people with disabilities have the right to have some 
control cover the destinies that they seek, and that the 
agencies that we establish in our community, and the 
awareness that we promote in our community is intended to be 
in support of our efforts to seek and control our futures. I 
suspect that that commitment comes in part out of his own 
personal involvement in finding his destiny when he was a 
younger man in San Francisco. 

Excuse me. I got a little nervous after I got up 
here. That doesn't usually happen to me. 

This is real important, I think, to all of us. I 
guess I want you to hear that Bill also has as his philosophy 
a belief that disabled people are expected and intended to 
support each other. And that's a very basic underpinning of 
everything that I've known him to be working on. It's 
manifested in the basic philosophy of the Independent Living 
Centers that are based on the idea that appears work with 



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each other and support each other in resolving concerns and 
difficulties . 

It's also been a part of his philosophy to create 
coalitions of disability groups where ever he has gone. The 
Board of Directors that I served on, which was part of the 
Independent Living Center, was a very diverse Board, and it 
was made up of folks with visual impairments, hearing 
impairments, mobility limitations, representatives from the 
developmentally disabled community, and a wide spectrum of 
people with disabilities. 

I think the other point to make is that the 
Americans with Disabilities Act has been an example for us of 
what we can accomplish when we work together in coalitions. 
For anything that we might give up in the way of separate 
programs, we gain many times over by our combined mutual 
strength. 

Bill's a strong leader. He is very well respected 
out here in the disabled community. Since he has taken 
office, there has been, where I work, an air of expectation, 
a new sense of hopefulness about working with the Department. 
This is a change from the past. In previous years, the 
Department has been viewed by its clients with a kind of 
cautious skepticism at best, and it has sometimes been viewed 
as an adversary to achieving personal goals . The need for 
advocate to approach the Department has been a part of the 
pattern in the past. 

We experience an excitement now in the disabled 



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community by individuals like myself, by consumers of the 
service, by potential clients, that there's a change coming 
for disabled people. A new Department of Rehab, is emerging. 

Now, one example of this, in my professional role, 
I am the Director of the Disabled Student Services Program at 
San Diego University. And I have watched students go through 
that program for many years. We've had a very minimal 
support by the Department of Rehab., for clients who were 
seeking Bachelor's Degrees, and I understand now that there 
will be increased support for those students. I'm really 
excited to hear that, because I believe that that's part of 
what California should be accomplishing. 

I don't know how you can find anybody better for 
this job, truly, than Bill Tainter. I — it's not just a job 
for him. This is his life philosophy that he is living his 
philosophy. He is an example of his philosophy. He and I 
are both products of the Department of Rehab., successful, we 
hope, working and paying our taxes. 

Bill brings his personal experience, his commitment 
and his philosophy to this job in a way that I can't imagine 
anyone else doing. I think that the Governor made a very 
correct choice by appointing him to this position, and I 
trust that you'll do the same in confirming him. 

Thanks. I'd be glad to answer questions. 

CHAIRMAN ROBERTI : Thank you very much for your 
very impressive testimony. 

Are there any questions? There are no questions, 



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thank you . 

It's 3:00 o'clock. We normally take a ten-minute 
break, so we're going to take a ten-minute break. 
[Thereupon a brief recess was taken.] 
CHAIRMAN ROBERTI: The Committee will come to 



order. 

Our next witness, please. Identify yourself. 

DR. GREENBERG: Thank you, Mr. Chairman. 

My name is Stanley Greenberg. I'm Executive 
Director of the Westside Center for Independent Living at 
12901 Venice Boulevard in Los Angeles. 

I am blind and have been blind since birth. As a 
person with a visual impairment, I've received both education 
and rehabilitative services from both state and private 
agencies . 

I feel eminently qualified to provide testimony to 
this Committee based on my experience as a professional in 
the field of disability, my role as a member of the 
disability community, and my status as a recipient of 
disability services. 

I might also add that I am a member in good 
standing of the California Council of the Blind. 

The purpose of this testimony is to make you aware 
of my unequivocal and uncategorical support of William 
Tainter as Director of the California State Department of 
Rehabilitation. In my opinion, Mr. Tainter is eminently 
qualified to fill this position and to serve with distinction 



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people with disabilities living in California. 

Mr. Tainter has demonstrated through service and 
example his commitment to two seemingly opposite but totally 
compatible realities. First, people with disabilities need 
categorical, disability-specific services in order for us to 
take our rightful place as equally valued members of society. 
Second, all people with disabilities must work together in 
order for us to achieve our common goal: that of full 
inclusion in every aspect of the life of our culture. The 
programs which Mr. Tainter supports address both of these 
realities . 

There is, however, another aspect of Bill's ability 
which makes him an outstanding Director for the Department of 
Rehabilitation. He recognizes that he is a member of a team. 
In that role, he accepts the responsibility to bring the 
concerns of all people with disabilities to that team and to 
exert maximum influence to affect the difficult decisions 
which must be made. In some cases, and God knows, we've 
experienced them very recently, the choices may place him in 
a no-win situation, but we believe he's up to the task. 

Finally, most of us in the disability community 
have been very critical of the recent policies and 
practices of the Department of Rehabilitation. We believe 
that Mr. Tainter is both willing and able to lead the 
Department toward addressing more appropriately the 
challenges faced by people with disabilities in the 1990s. 

I urge you to recognize that the overwhelming 



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majority of people with disabilities in California support 
Mr. Tainter's appointment as Director of the Department of 
Rehabilitation, and I urge you to confirm that appointment. 

Thank you. I have written testimony here in print 
and in Braille for those who have a choice. 

CHAIRMAN ROBERTI : Thank you very much for your 
testimony. 

DR. GREENBERG: I'd be happy to answer any 
!| questions. 

CHAIRMAN ROBERTI: Any questions? Hearing none, 



thank you very much. 

Anyone else here in support? Please come forward. 



MR. TREECE-SINCLAIR: Senator Roberti, Members of 
the Committee, good afternoon. My name is Les 
Treece-Sinclair. I am the President of Disabled in State 
Service. 

The Disabled in State Service, or DISS as we call 
it, was formed in 1976 by a group of concerned state 
government employees, virtually all of whom had disabilities. 
The purpose of the organization was to create a mechanism, a 
forum, if you will, to address disability employment issues 
within state government; to promote more equitable employment 
opportunities for persons with disabilities in state 
government . 

Now, some 16 years later, the organization has 
grown to several hundred members around the state. And while 
our focus still is, to a very large extent, state government, 



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we now also deal with local government and institutions of 
higher education. 

We are here today because the Board of DISS 
unanimously voted and has acted to endorse the confirmation 
of William Tainter as Director of the Department of Rehab. 

Unlike some of the previous speakers, I have known 
Bill only a short time, going back to the fall of 1990. But 
once he became the Director of the Department of Rehab, in 
the spring of 1991, Bill's relationship with DISS clearly 
indicated that he was prepared to take the agency into at 
least one new direction, and that new direction was to 
become involved with DISS as the only disability advocacy 
organization promoting employment opportunities for 
individuals specially within the state government sphere. 
Bill became actively involved. 

Let me cite an example to show the level of that 
commitment. Bill mentioned that the Governor has designated 
the Department of Rehab, as the lead agency on the 
implementation of the new Americans with Disabilities Act, 
federal civil rights legislation. 

In the summer of last year, 1991, Disabled in 
State Service, with the assistance of two other disability 
organizations, began to put together a training seminar which 
was subsequently held November 6th here in Sacramento; a very 
successful ADA training seminar which attracted some 450+ 
persons at the Sacramento Community Center. 

The Department of Rehab. , which for many years had 



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not been directly involved with DISS on events, nor had it 
been really substantially involved in the state government 
disability employment sphere, became very much involved. 
Bill personally committed an assistant deputy director to be 
a part of the planning of the program, distributed materials 
throughout the state, and detailed a deputy, an assistant 
deputy, program mangers, and other staff to serve as resource 
individuals, panel members of the program, and he personally 

welcomed the audience, bringing a written message from the 

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Governor . 

Small example, but it was a major change from what 
DISS had experienced in prior years from the Department of 
Rehab. Clearly, the agency has seen the importance of 
becoming involved, both in ADA and again its new role, and 
involved in state government. Other agencies have key roles, 
such as the Department of Personnel Administration and the 
State Personnel Board, but when it comes to disability 
employment, the Department of Rehab, must play a key and lead 
role. And Bill Tainter began last year to define the 
agency's role in that new direction. 

DISS, again as the disability advocacy 
organization, promoting employment opportunity in that 
sphere, is very pleased with this new direction. 



I would also simply note, too, we have heard from 

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there is still much to be done. There are still issues to be 
resolved. There are things that still need attention. All 



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is not perfect. We are not all yet in accord or agreement on 
|| decisions and actions. 

Let me just remind all of us that the disability 
minority, and I emphasize that word — the disability 
minority community — is no different than any other minority 
community. We are not absolutely homogeneous with it comes 
to understanding our needs and concerns and issues. The 

disability community is made up of many subgroups and 

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populations and sub communities. That is the nature of the 

beast. 

I'm very pleased to have noted that even in his 
short time as Director of the Department, Bill is clearly 
making an effort to enhance the communication between groups, 
to achieve a fair and equitable balance between resources and 
possibilities and the needs of a variety of different 
constituencies within the disability minority community. And 
I think it bodes well for the program in the future. 

Most of the other comments that you heard from 
other people covered other things that we might say, but 
again, for the progress that DISS has clearly seen over the 
last year, and for the progress that we clearly anticipate 
over the next year, we have, again, endorsed Bill Tainter and 
urge your confirmation of him as Director of the Department 
of Rehab. 

Thank you very much. 

CHAIRMAN ROBERTI: Thank you very much. 

Next witness. 



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MR. BLACK: Good afternoon, Mr. Chairman and 
Members of the Committee. My name is Ralph Black. I am the 
President of the California Association of Persons with 
Handicaps, which is one of the oldest and largest 
organizations of people with all types of disabilities in the 
State of California. 

We have been working for over 20 years to improve 
opportunities for people with disabilities in areas such as 
removal of architectural barriers, opening up employment 
opportunities, and ensuring that people with disabilities 
have a full opportunity to participate in all aspects of 
society. In that time, the disability rights movement, of 
which we are a part, has accomplished a great deal. We've 
made significant progress in eliminating barriers in the 
physical environment. We improved access to transportation 
and education. But the one area that we still have not 
really solved as a problem for people with disabilities is 
the area of employment. 

Even today, in 1992, two-thirds of people with 
disabilities are unemployment or underemployed, and those of 
us that are employed typically are paid less and have fewer 
opportunities for promotion. 

The agency in state government that is charged with 
addressing this problem is the Department of Rehabilitation. 
And many of us in the disability movement have long felt that 
the Department has not been as effective in addressing these 
problems as it might have been for a number of reasons. 



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Partly because it strove to place people primarily in entry- 
level jobs; it took a traditionally rather paternalistic 
attitude towards dealing with people with disabilities, 
trying to tell them what was good for them; and it also 
sought to find people with minimal disabilities and put them 
in low-cost programs so that they could get — show high 
numbers of placements at very little cost. 

We are pleased to support the Governor ' s 
recommendation of Mr. Tainter to serve as the Director of the 
Department because we believe that his few months in office 
indicate that he has begun to take the Department in a 
different direction, to put in place some principles that 
will bring about the improvements in employment opportunities 
for people with disabilities that we have so long needed. 

First of all, he is very committed to preparing 
people with disabilities for careers, not just for dead-end, 
entry-level jobs. He believes in consumer control and client 
participation, that the client should define their goals, 
with advice and assistance from the Department, but that the 
Department should facilitate what the client needs. 

He has indicated a definite willingness to work 
with the disability organizations and people in the disabled 
community to try to understand what the needs are and to 
begin working with the organizations in a way that certainly 
has not been characteristic of the Department's participation 
in the last few years. 

He has indicated to you himself this afternoon his 



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interest in serving people with severe disabilities and 
getting away from that numbers game that I discussed earlier. 

He is, of course, a part of the independent living 
movement and shares that philosophy of promoting and 
maximizing independence for all people with disabilities. 

And finally, he is one of us. He is a person who 
has come out of the disability rights movement, and although 
you have heard quite a bit today about the differing needs of 
different people with disabilities, Mr. Tainter, as a person 
with a disability, shares with all of us the common 
experience of having been denied opportunities, discriminated 
against, and having been a client, having to try to struggle 
with the bureaucracy of the Department of Rehabilitation. 

And while he does not have first-hand experience 
with every type of disability that is represented in our 
community, I think that what you have heard today in terms of 
the discussions that have gone on with various organizations 
certainly indicates that he has the willingness and ability 
to listen and to work cooperatively with the various interest 
groups to try to come to resolution of some of the tough 
issues that face the Department in the years to come. 

For these reasons, the Board of Governors of our 
Association, at its December meeting, adopted a resolution 
which we have included with a letter that we submitted in 
advance of the hearings. Let me just conclude by reading the 
final paragraph of that resolution, which says: 

"The Board of Governors of the 



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California Association of Persons 
with Handicaps, representing a cross 
section of persons with disabilities 
and sensory impairments throughout 
California, and on behalf of the 1.6 
million Californians with 
disabilities, strongly endorses the 
Governor's appointment of William 
Tainter to serve as Director of the 
Department of Rehabilitation. " 
Thank you, and I'll answer any questions. 
CHAIRMAN ROBERTI: Thank you very much. 
Any questions? Senator Mello. 

SENATOR MELLO: I have another commitment that will 
take me away briefly. 

I'm just wondering if the roll can be kept open on 
Mr. Tainter and the other nominations? 

CHAIRMAN ROBERTI: We will do that, thank you, 
Senator. 

We're running a little bit lengthy, so if witnesses 
come forward to indicate their support, if they anything new 
to add, we certainly welcome that. If it is a repetition, we 
understand your wanting to saying something, but maybe in 
that case just indicate your support and that of your 
organization. 

MS. VESCOVO: Senator Roberti, I'll keep it less 
than a minute. 



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My name is Norma Jean Vescovo. I am the President 

of the California Foundation for Independent Living Centers. 

My home is 14402 Haines, in Van Nuys, California. 

We have offered our support of the 28 Independent 

Living Centers for Bill Tainter's consideration of his 

position, and we would hope you take that into consideration. 

Thank you . 

i, 

CHAIRMAN ROBERTI: Thank you, Ms. Vescovo. 

Any other witnesses? 

MR. SEATON-MSEMAJI : Senator Roberti and Members, 
my name is Ken Seaton-Msemaji, United Domestic Workers of 
America, who represent home attendant employees who provide 
home care for elderly and disabled people throughout the 
State of California. We represent the home attendants in 14 
California counties. Our base is in San Diego, where we 
started. 

I came to know Mr. Tainter in the late '70s, early 
'80s, and the only thing that I would add to what's already 
been said and to what we've written in our letter is that for 
those who testified earlier explaining some of their 
differences of opinion, but that they were working and 
negotiating and trying to resolve, I sit here as a person who 
differed significantly many times with Mr. Tainter in those 
early years, and his leadership was the kind that could force 

us and all of the other groups to the table to really in fact 

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work out our differences, which was very difficult to do 
many, many times. He always sticks to his word. He is very 



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straight and direct and blunt; you don't have to figure out 
where he ' s at . 

And I would suggest to those who've had some 
concerns that we are in the best shape we can be in with 
William Tainter at the head of this very important 
Department. He is not a status-quo person. He will make 
that Department better than it's ever been, and he will keep 
his word and work out and resolve to mutual satisfaction all 
of the kinds of problems that has been spoken about here 
today. 

So, it's with great pride that I get a chance to 
come and give him the kind of support that he's given to many 
of our groups during very difficult times, and his 
problem-solving abilities, and his credibility, and his 
honesty is what really makes me — I talked to my Executive 
Board, who are spread out over this state. They talked to 
their local boards, and almost unanimously, the ones who had 
been involved and know about Bill Tainter were happy at 
allowing me to come here and express this support. 

Thank you very much. 

CHAIRMAN ROBERTI: Thank you very much. 

Is there anyone else in support? Is there anyone 
else in opposition? Please come forward. 

MR. BORELLI: Good afternoon. I'm Paul Borelli, 
and I'm totally bind, and I'm opposed to the Tainter 
confirmation because I feel that he was antagonistic toward 
programs for the blind. 



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But I would like to see — I'm for a disabled 
person as head of the State Department of Rehab., and I hope 
that we can all work together for the betterment of all 
disabilities, including the blind. 

Thank you very much. 

CHAIRMAN ROBERTI: Thank you very much. 

Next witness. 

MR. ROMPEL: Mr. Chairman and Members of the 
Committee, my name is Frank Rompel, Jr. I'm the Chairperson 
of the VOICE; it's an acronym for Vendors Organized In 
Communication and Education. We're a Political Action 
Committee that represents the vendors in the Business 
Enterprise Program in California. 

Let me back up a second. Our members consist of 
vendors in the Business Enterprise Program in California. 

We support the resolution drafted by the California 
Vendor Policy Committee, and it was unanimously accepted by 
that Committee, that opposes the confirmation of Mr. Tainter 
as the Director of the Department of Rehabilitation. 

Among our concerns in VOICE is what appears to be a 
contradiction to a term that I listened to Mr. Tainter make 
in a speech last November, when he addressed the National 
Federation of the Blind in Los Angeles. And the phrase is 
"consumer friendly." It was his intent in that speech that 
he would make the Department and its programs "consumer 
friendly" for those of us that have a need to utilize them. 

I'm a vendor also in the Business Enterprise 



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Program, and my father was also. So, I'm a second generation 
legally blind person in the state, so I'm also a success 
story from the Department. 

Some of the concerns that we've seen that seem 
contrary to the term "consumer friendly" — and it's been 
used by deputy directors also, so it is, apparently, a phrase 
that has been coined that has intentions of being utilized, 
but we've not seen that yet. 

One of the areas that we've not seen a consumer 
friendliness is in the communications from the Department to 
the vendors in this state. It seems almost absent or near 
absent. 

We have in excess of two dozen letters that have 
been written to Mr. Tainter to ask him to address issues or 
concerns that we've had with our program. And I will not say 
he has not addressed anybody's letter, but we have over two 
dozen people who have not had their letters responded to; one 
person in particular has written 13 separate letters and not 
had even a return letter from Mr. Tainter, from a deputy 
director, or a phone call in place of a letter. That lack of 
communication is very frustrating. 

At times, phone calls will be made to various 
deputy directors, and in a couple of instances, perhaps, it 
was to complain about a person within the Business Enterprise 
Program. But the phone call that was made to a deputy 
director gets returned by the administrator of the Program. 
So, when you try to deal with the issues as they relate to 



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our program, and we go to the appropriate persons in the 
ladder, they don't get the attention of those persons; they 
get kicked back down. And again, that's very frustrating for 
us, because that is — there's a path that we need to follow, 
and that's the path we're told, yet we don't get any 



information from them. 



Phone calls that are made to the Department go 
unreturned at all. They just — they seem to not even 
address our issues at times. 

We've made requests for information that the 
federal law allows us as it relates to our program. In 
particular, we've made requests for an application for the 
designation of the state licensing agency, which BEP has to 
file with the federal government. This designation includes 
the mission, the goals, and the objectives that the 
Department has told the feds they're going to utilize in the 
administration of our program. 

The law tells us we have a right to this document, 
yet we've never been given that document. We'd like to know 
what they have told the feds their mission is. We don't know 
where they're taking our program. There's no clear path. 
There are no policy manuals; there is no budget. There is 
nothing concrete that we can put our fingers on to say this 
is where our program is headed. 

CVPC delegates, who are elected by vendors in the 
state to deal with policy matters as they relate to vendors, 
have made requests for addresses of the vendors in our state, 



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to get the addresses to be able to deal with them, to get 
their feelings on various issues and such. The CVPC 
delegates have been told that they don't have a right to 
those mailing addresses. They don't need to know the 
addresses of their fellow vendors and how they're able to 
communicate with them. 

That cutting off of communication is prevalent in 
all the various areas I've outlined. 

Another concern, or what appears to be certainly 
not "consumer friendly", is access to due process. The 
Welfare and Institution Code instructed the Department to 
hold the CVPC election, which was done — very tardy, but it 
was completed. I might add that there were 13 grievances 
filed in that election. A number of them are going to go to 
federal arbitration. It was not done according to past 
processes. There was no need to re-invent the wheel. We had 
an election process in place; it just was not utilized. 

The vendors have no appeal process, we're told by 
the Department in their handling of this election. So what 
we have is the W&I Code saying the state's required to hold 
the election. The Department of Rehabilitation's legal 
department says, "We don't have an appeal process as it 
relates to the CVPC election process . " 

The Welfare and Institutions Code also says we have 
a grievance process. It would make — It would seem clear 
that if the W&I Code says that they're responsible for the 
election, and the W&I Code says the vendors have a right to 



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file a grievance, that we would be able to file a grievance 

in their handling of the election. Yet their legal 

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department ' s interpretation is that we do not have any due 

process at all in that election. That doesn't seem quite 

right at all. 

Another area of what doesn't appear to be "consumer 
friendly" is, Mr. Tainter, when he had taken the exempt 
position away from the California Vendor Policy Committee, I 
understand that that has been changed today; that decision 
was reversed. 

I would be curious to know, however, how this 
exempt position is going to be filled. By that, I mean this: 
The exempt position that was taken for Mr. Tainter' s aide, I 
believe, paid somewhere between $30,000-40,000 per year. I 
would be curious to know if this new exempt position is going 
to have that kind of salary base, which will attract a 
professional sort of person to be assistant to the California 
Vendor Policy Committee, or is it going to be a significantly 
lower wage, which perhaps may attract a clerical person, 
which will not enable the California Vendor Policy Committee 
to do as much as they possibly could with the previously 
salary structures. I would hope that we're able to get an 
answer to that, as to what that salary structure will be for 
that exempt position. 

Another area in regards to consumer unfriendliness 
is, and this is just one example, if I may. There was a 
vendor who was receiving a — at 11000 Wilshire, the Federal 



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Office Building on Wilshire Boulevard in L.A. — was 

receiving vending machine commissions that were taken away 

last July. They were taken away by the Department telling 

the vendor that their interpretation of the federal law says 
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he was no longer entitled to the full commission he was 

receiving. 

He communicated back to the Department . They told 
him that that was okay; that that was their decision and that 
was final. 

He retained legal counsel; paid thousands of 
dollars; drafted letters and communicated with the 
Department. And then, surprise-surprise, the Department's 
legal department says, "Oh, you're right. You are entitled 
to that money." And now they're in the process of 
negotiating to give it back to him. 

That's not consumer friendly. This gentleman's 

i 

income was cut by less than 50 percent. He fell behind in 
his personal obligations. He was dependent on this money, 
and there was no need at all to take away this man's income. 

Another area of concern to vendors in California, 
Mr. Tainter had an article featured on him in the L.A. Times. 
It was printed December 30th, and in it, he made this quote. 
He said his goal in the Department is to, quote, 

"... orient the Department so it 
will begin sending clients to 
college instead of trade schools or 
into entry-level jobs that evaporate 



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after only a few months." 
End of quote. 

That goal is contrary to one that would promote the 
Business Enterprise Program. Our training program is in 
essence a trade school. We take individuals and train them 
to run cafeterias and snack bars in the various city, county, 
state and federal buildings in the state. That's a trade 
school. And if his intention is not to go towards the trade 
schools, it's odd. 

Mr. Tainter's response to the California Vendor 
Policy Committee resolution, he states in there some facts 
that I don't know how he's going to be able to accomplish. 
He says that there's 27 new locations that are going to be 
opened up in our program. That's 27 locations that will need 
a new vendor. There's 27 interim locations in the state 
right now that do not have a vendor; we have people operating 
multiple units. So, there you have 54 vendors that will be 
needed to handle those. You have 26 vendors, approximately, 
that will dissipate within the next 12 months just through 
the annual 10 percent attrition rate that happens within our 
program. If you add those up, that's 80 vendors that will be 
needed. There are five trainees in the last training class 
that we have in this state. 

So, while going to college is an admirable goal, 
and it certainly is an avenue for lots of folks, it's not an 
avenue for everybody. And it's going to require rehab, 
counselors understanding that trade schools, in particular 



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our trade school, is positive and necessary for blind 

persons. It's necessary to help them be able to become 

productive and able to operate within our program. 

Lastly, if I might, and I believe I'm doing this 

with as much — with respect for Mr. Tainter, it seems to me 

personally ironic that Mr. Tainter, which is according to the 
I 

Sacramento Bee and the Los Angeles Times , just filed a 

$250,000 lawsuit against a commercial airline for their 

,i failure to follow federal laws, and for their inconsistency 

in following airline boarding procedures. 

Yet under Mr. Tainter's administration in this 

Department, DOR has failed to follow state and federal laws 

as it relates to the Business Enterprise Program. And his 

administration has been inconsistent in following procedures 

to administrate our program, and mostly because there is not 

! 

a policy manual in place to administrate our program. 

I might state that we are a $50 million a year food 
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service concern, with 250 blind persons in city, county, 

state and federal buildings throughout the state. It's not a 

mom-and-pop shop; it's a program mandated by the feds. It's 

a beautiful program. We're in every state in the country, 

and it needs a policy manual. It needs — 

CHAIRMAN ROBERTI : Maybe we can interrupt you right 
there . 

I'm interested in the point on the policy manual. 
Why isn't there a policy manual, Mr. Tainter? Could you 
address that, or is there? 



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MR. TAINTER: There is not currently a policy 
manual . 

We have a system in place to put together that 
policy manual in the current year. 

CHAIRMAN ROBERTI: So you do expect one? 

MR. TAINTER: Yes. 

There's never been a policy manual, is my 
understanding. This is one of the focal areas that we're 
going to work on. 

CHAIRMAN ROBERTI : Right . So that * s not something 
unique to your administration, and you're trying to alter 
that . 

MR. TAINTER: Yes, we are. 

CHAIRMAN ROBERTI: Senator Petris has a question. 

SENATOR PETRIS: Another question on that, too. 

Are you saying there's never been a policy manual 
in — 

MR. TAINTER: Not to my knowledge. 

SENATOR PETRIS: — in all the history? 

MR. TAINTER: To my knowledge, there has not been a 
written, established policy manual. It's always kind of been 
run off the cuff. 

SENATOR PETRIS: Have you made demands on prior 
Directors for a manual? 

MR. ROMPEL: Not to the extent that we have here, 
the revamping of Senator Mello's — Senator Mello sponsored 
SB 2759, which rewrote the W&I Code. They were a wonderful 



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change to the program. 

The problem is that what's on paper is beautiful. 
It has not been adhered to; it has not been followed. The 
W&I Codes are not followed in the key areas that it was 
designed to do. 

It was designed to strengthen the accountability of 
the Department to the vendors as they administrate our trust 
fund and help our program grow. 

SENATOR PETRIS: While we're on past policy, what 
about the counsel's opinion that you're not entitled to due 
process? Is that an old, standing — 

MR. ROMPEL: No, this — this is what occurs when 
you don't have a policy manual. 

What they've done here is say that we do not have 
due process in this one particular area. They say that we 
have process in every other aspect, but since they aren't 
responsible for the election -- and if I'm wrong in my 
paraphrasing, forgive me — since they're not responsible for 
the total administration of the election, we cannot file a 
grievance as it regards to that. 

SENATOR PETRIS: Now, is that statement a new 
policy, or is that a traditional one? 

MR. ROMPEL: That has never occurred before. 

SENATOR PETRIS: There's always been some grievance 
procedure recognized in the past? 

MR. ROMPEL: Absolutely, with any decision there's 
a grievance procedure. 



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SENATOR PETRIS: That would be a major departure 
from past policy. 

MR. ROMPEL: Absolutely, without question, 
absolutely. 

If I may continue on this one subject here, we're 
happy that Mr. Tainter has the right to file this lawsuit, as 
any person, whether it be disabled or not, should be able to 
do when they're harmed and such. 

What we're asking for, is it too much for blind 
vendors to have — to be able to file a grievance and also 
have due process? Why should we not have that same right? 

We're not looking to file lawsuits. We're looking 
to file grievances and deal with the problems 
administratively within the Department. 

CHAIRMAN ROBERTI: Thank you very much. 

Any questions? Hearing no questions, we appreciate 
your testimony. 

MR. ROMPEL: If I may make a last statement, I 
don't know the correct jargon, but it's an extremely 
important issue to the vendors in our program. And it would 
seem appropriate — I don't know the correct term — but, you 
know, the last 24 hours, the response to their resolution was 
determined and dissipated [sic] throughout the people in the 
state, and not everybody's had a chance to see it. 

If you had the right, if you were able to allow 
them to hold their CVPC meeting this weekend, go over it, 
VOICES will contact our members and such and go over the 



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57 
information. Were you able to hold it over to give the 
vendors a chance to get back to you with their position. 

CHAIRMAN ROBERTI: What we're probably planning to 
do, Mr. Rompel, is to take a vote today; however, we will 
hold it on the Floor, which is the critical vote is on the 
Floor, for three weeks because we respect the concerns of the 

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blind organizations, in particular the Blind Vendors do have 
a right to get their point of view across to us and, maybe, 
to work out any problems there may be — 

MR. ROMPEL: We'd love to work — 

CHAIRMAN ROBERTI: — with Mr. Tainter. 

MR. ROMPEL: We'd love to work with Mr. Tainter. 

CHAIRMAN ROBERTI: We're going to hold it for three 
weeks on the Floor, but this has been a major hearing, and it 
won't be fair, I don't think, to the proponents or the 
opponents to not take a vote now if we can at all avoid it. 
I won't say we never postpone; we do. 

I think in this case, my sense is and I think the 
Committee ' s sense is that some of these problems can be 
worked out if we just don't rush the confirmation on the 
Floor. 

MR. ROMPEL: Okay. Thank you very much. 

CHAIRMAN ROBERTI: Thank you. 

Please come forward. 

MS. BALDWIN: Thank you. My name is Anita Baldwin. 
I'm the Executive Director of the San Francisco Lighthouse 
for the Blind. 



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I planned to be a listener today. I feel, though, 
that I'd like to make a comment. 

My comment is that my agency, and many other 
private agencies for the blind, and many of us who are 
consumers of services, are in strong support of Bill Tainter, 
and we wanted to make sure that you knew that . 

To remain silent seemed like, perhaps, it would be 
a lot of people representing one small segment that oppose at 
this point, as opposed to many of us who represent broader 
cross sections that are saying yes. 

I've known Bill for twelve years. We've worked 
through a lot of things together, personally and 
professionally. We've learned about how to get employment in 
a market that didn't employ people with disabilities. We've 
learned about how to deal with the Department of 
Rehabilitation from the consumer side of the fence, and I 
strongly believe that Bill can deal with it from the 
administrative side of the fence. 

Thank you. 

CHAIRMAN ROBERTI: Thank you very much. 

I don't think there are any other witnesses, so, 
Mr. Tainter, you may conclude. 

Senator Petris, however, has a few questions. 

SENATOR PETRIS: Yes, very brief. 

I've been asked to pose some questions by one of 
our committee chairs that has to do with the Federal 
Rehabilitation Act of 1973, which is being re-authorized by 



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59 
Congress. I'm sure you're familiar with that. That's to 
promote more independent, productive lives for people with 
disabilities . 

And in response to this reauthorization, the Senate 
passed a resolution authored by Senator Watson in which the 
Legislature commissioned a study to parallel the 
Congressional reauthorization. 

So based on that, I have some questions I'd like 
you to answer for me. 

Does the Department of Rehab, have a role in 
assisting the construction of the federal legislation? 

MR. TAINTER: The Department has put together a 
task force, headed by Curtis Richards, who's an exempt 
appointee of mine. And we will be holding up to six hearings 
throughout the state involving the three Congressmen involved 
in the reauthorization: Congressmen Miller, and Cunningham, 
and Martinez. 

Of course, we also plan to have, in their districts 
-- because also we're going to have additional hearing with 
Senator Seymour to get input from the community. 

We basically have time lines to work on the 
particular reauthorization, and we will be providing a 
basically an issue paper from the Department of 
Rehabilitation with regard to the reauthorization. 

We consider the reauthorization to be a real 
pivotal kind of an issue. 

SENATOR PETRIS: How far along are you? 



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MR. TAINTER: Well, we got started on this about 
three months ago. 

SENATOR PETRIS: Was this in response to SJR 25? 

MR. TAINTER: Well, it was something that I was 
going to do anyhow. 

SENATOR PETRIS: You were going to do it anyway? 

MR. TAINTER: Yes. But I've also been in touch 
with a lot of people throughout the state — Ed Roberts, and 
so on — to see what their feelings, and others. 

SENATOR PETRIS: And you're going to be developing 
this parallel? 

MR. TAINTER: It'll be a parallel SJR 25, which 
essentially was one of our highest priorities when we got 
here. This is our chance — 

SENATOR PETRIS: How many others are on this staff? 

MR. TAINTER: Oh, three or four, I think it is, of 
our folks . 

But our primary role is to get the input from our 
constituency regarding what they see is important in the 
reauthorization. That's why we've involved the three 
Congressmen on the Labor and Education Committee, who'll be 
reviewing the reauthorization. 

SENATOR PETRIS: Do you believe these efforts on 
your part to respond will benefit the consumer? 

MR. TAINTER: Oh, very much so, in that, as I 
stated earlier, we want to get more consumers and 
organizations representing their interests involved in the 



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reauthorization. This is our chance now to see the federal 
law become — basically what I would like to see is more 
consumer oriented; have rehab, plans driven by people with 
disabilities. Give people the maximum opportunity for 
working competitively and living independently, and, 
hopefully, the greatest amount of control by disabled people 
themselves . 

SENATOR PETRIS: So this would involve some changes 
in the state ' s program to provide the tracking? 

MR. TAINTER: We're primarily geared by the — 
driven by the federal law, so we get the federal law more 
responsive, then we can come to you folks at the state level. 

SENATOR PETRIS: One other question on a different 
subject, but I'd like to hear your responses to the last 
witness . 

I ' ve been told that there may be a problem at the 
Independent Living Center's computer program. It might be in 
jeopardy. Do you have any information on that? 

MR. TAINTER: No, there's no such — there have 
been no discussions along that line, and I wouldn't see that 
be an issue. It certainly isn't anything that's in the 
Governor's budget, particularly the training programming. 
There's one in L.A. and there's one in your district, but 
they've been — we've supported those. 

SENATOR PETRIS: It's my district that called me, 
people in that district who called, and nobody from L.A. 

MR. TAINTER: In some of those budget drills, we 



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might have talked about some problems. 

SENATOR PETRIS: You think they're going to be 
okay? 

MR. TAINTER: Yes, if you folks, you know, agree to 
our budget, hopefully. 

SENATOR PETRIS: Thank you. 

CHAIRMAN ROBERTI: You're a good lobbyist. 

You may conclude, Mr. Tainter. 

MR. TAINTER: Well, I think many of my 
professional friends have been here to basically talk about 
my background and basically my philosophy. I think you 
understand my philosophy pretty well. 

I haven't had the fortune to talk to you, Senator. 

And I really think that the thing to do is to 
approve the Governor's recommendation to con firm me for this 
position, for this appointment. 

SENATOR PETRIS: May I ask, Mr. Chairman. 

CHAIRMAN ROBERTI: Yes, Senator Petris . 

SENATOR PETRIS: There were specific : :ments made 
by the last witness. Fcr example, the "user friendly" theme, 
which sounds very good. But he mentioned some examples cf 
things that he thought were just the opposite. 

Do you want to answer any of those? 

MR. TAINTER: Well, some of those specific issues, 
think, we addressed in our response to the CVPC opposition. 

With regard to the appeal process and so on, it mas 
our legal opinion that the Appeals Board, basically, is 



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concerned with consumer client issues; that you have to be a 
client of the Department and so on. 

But my understanding, there's always been a 
grievance procedure of some kind, and if there isn't, we'll 
make sure there is one. 

SENATOR PETRIS: Well, the witness contends that 
for the vendors, there isn't any where there used to be. 

MR. TA INTER: I haven't made any decision — to my 
knowledge, I haven't done anything that would lessen their 
right to a grievance procedure . 

SENATOR PETRIS: Apparently counsel has. 

MR. TAINTER: Well, that's — 

SENATOR PETRIS: They've been communicating with 
your counsel, and he says no; there's no provision for any 
grievance. 

MR. TAINTER: There's two issues. One is grievance 
procedures, which we haven't done anything to lessen them. 

And secondly is the issue, they wanted to know 
could they appeal any of their grievances to the so-called 
Appeals Board. The Appeals Board is made up of, I believe, 
seven appointments by the Governor, and their role is to 
review clients who appeal to the Department that they're 
unsatisfied with the services they've received. It's 
basically an organization or a board that provides a 
recommendation to me on how we should provide the services . 

They're not individual clients, so hence legally 
they're not entitled to go to the Appeals Board. 



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Now, with regard to grievances, whatever grievances 
where always in place have not been pulled back at all. I 
mean, I did nothing of any positive nature to do that. I 
mean I think — 

SENATOR PETRIS: There seems to be a major 
difference there as to what the Welfare and Institutions Code 
provides . He seemed to be very emphatic that under Senator 
Mello's legislation, vendors are supposed to be included. 
Maybe we need to review that . 

Do you think it's a good policy, regardless — 

MR. TAINTER: I think they should have — 

SENATOR PETRIS: — of the fact, shouldn't they 
have a right of appeal? 

MR. TAINTER: Without a doubt. Everyone should. 

SENATOR PETRIS: Okay. Well, we'll have to look 
into that and provide for it . 

MR. TAINTER: I share their concerns. The 
Department has not been as responsive as it should be to the 
vendors, but we're certainly going to actively work to 
resolve that. 

SENATOR PETRIS: Be more user friendly for them, 
too. 

MR. TAINTER: Well, I thought "user friendly" was a 
very compatible term, because we haven't been user friendly 
in the past, and we need to be. 

SENATOR PETRIS: Thank you. 

CHAIRMAN ROBERTI: Thank you, Senator. 



65 

Do I hear a motion? 

SENATOR CRAVEN: So move. 

CHAIRMAN ROBERTI: Senator Craven moves 
confirmation be recommended to the Floor. 

The Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. Senator Petris . 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: There are sufficient votes. 
Senator Mello wants the roll held open so he can cast an Aye 
vote. So, Senator Craven, I will take it as part of your 
motion, as your motion, to hold the roll open until Senator 
Mello has a chance to cast a vote. 

Without objection, that will be the order. 

We will hold the confirmation on the Floor for 
there weeks to give Mr. Tainter a chance to talk to some of 
the organizations representing the blind, especially the 
Blind Vendors, and then we'll take the confirmation up on the 



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Floor. 

Congratulations, Mr. Tainter. 

MR. TAINTER: Thank you. 

[Thereupon the Rules Committee 

acted upon legislative items.] 
CHAIRMAN ROBERTI: Mr. Boren, I believe, is from 

out of the city, so you luck out a little bit and you get to 

i 

come up next . 

Senator Craven, I'm going to turn the Chair over to 
you . I have another meeting in the room next to us . 

SENATOR CRAVEN: Very well. 

Mr. Boren, if you will wait just a moment. 
[Thereupon the Rules Committee 
acted upon further legislative 
items . ] 

SENATOR CRAVEN: Now, Mr. Boren, please. This is 
Mr. Frank D. Boren, Member of the Fish and Game Commission. 
He is an appointee of the Governor, and we will ask him, as 
we do all the appointees, nominees, to tell us why you feel 
you are qualified for this position? 

MR. BOREN: From the conservation standpoint, I 
started in that movement in 1969 as one of the original 
founders of the Southern California Chapter of the Nature 
Conservancy. I went on to be the Chairman. I then was 
involved with the Nature Conservancy in merging the Northern 
California Chapter and the Southern Chapter and became 
Chairman of that. 



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67 

I went to the National Board of Governors of the 
Nature Conservancy, worked hard there and became a Chairman. 
I left commercial life in 1986 to become the Western Regional 
Director of the Nature Conservancy paid staff. I was asked 
to become the President, went back to Washington, D.C., and 
was involved as President of the Conservancy from '86 until 
1990. 

I now devote my time to causing change in the 
environment and trying to make sure the private sector is 
involved in that change, because my philosophy is, if the 
economy is not involved with the environmental movement, the 
environmental movement won't make it. 

So, that's why I feel qualified to be on the Fish 
and Game Commission, where a lot of these interests are now 
in competition and must find a way towards a better harmony. 

SENATOR CRAVEN: Thank you, Mr. Boren. 

Senator Petris . 

SENATOR PETRIS: What do you see as the major 
problem that you have to tackle approaching that office? 

MR. BOREN: I think the major challenge is to — 
well, one is to make sure we follow the law that the 
legislative body in California has adapted [sic]. 

And secondly, to work on means to come to harmony 
so that the economy and the environment are not in a 
combative role but in a compatible role. And I think, based 
on good science, and people working together in harmony, in 
stead of all the negative energy spent now, layer fighting 



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layer, we've got to come to a conclusion or it's going to, 
one, hurt the economy, or two, it's going to hurt the 
environment. I think it's a critical time. 

SENATOR PETRIS: Are you getting pretty good 
cooperation from all around? 

MR. BOREN: Well, I'm just on the Commission and 
vote, and I think we're in a changing time. 

SENATOR PETRIS: What does that mean? 

MR. BOREN: I'm still learning. 

SENATOR PETRIS: Well, I keep seeing these reports 
come out of L.A., the Chamber of Commerce, saying that 
there's a massive exodus out of California because of 
environmental regulations . 

I think it's a myth. It's been exploded by a study 
made elsewhere, and I wondering if they keep throwing that up 
at you in your meetings when you ' re trying to pursue the very 
noble policy that you described at the outset. 

MR. BOREN: Well, the toughest statute on the books 
is the California Endangered Species Act. And that is a very 
blunt instrument, and that has caused concern. 

And what the Governor is trying to do with the NCCP 
plan, and what a lot of writers feel should be done, is more 
harmony. But that isn't what that Act now says. 

SENATOR PETRIS: Does it need changing? 

MR. BOREN: I think it needs a re- look, yes, but 
that's a legislative job. 

SENATOR PETRIS: Yes, but we look to you for 



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guidance. Are you willing to give us some guidance on that? 
If you're asked -- 

MR. BOREN: Yes, I think that — 

SENATOR PETRIS: — how can we improve that 
statute? 

MR. BOREN: I think that could be a very proactive 
role that the Commission could play, bringing the best minds 
from the environmental community, particularly the 
scientists, and some of the proactive business minds. And I 
think progress could be made. I think it could be 
substantial . 

SENATOR PETRIS: Well, I was going to say, I'm 
delighted to see the Governor select someone like you, who's 
been out there in the commercial side of things and has such 
a strong record in the Conservancy. 

I remember a lot of fights here on the ozone. We 
had bills to eliminate certain kinds of sprays, and industry 
comes in here and laughs at us . And they fought against it 
and defeated the bill time after time. Now we're discovering 
we're in very bad shape. It's right over the United States 
and Canada . 

MR. BOREN: That's right. 

SENATOR PETRIS: There are other examples, too. 
That's the most dramatic right now. They don't seem to pay 
any attention to the scientists. They just have a total 
disregard for them and place their own mission ahead of 
everything else, and to the exclusion of everything else. 



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So, I applaud your efforts to try to educate them. 
I think that's extremely important, I wish you well. 

MR. BOREN: Thank you. 

SENATOR CRAVEN: You might also recognize the fact 
that he's a Stanford man. 

SENATOR PETRIS: Well, that kind of warmed me up to 
him in the beginning. 

[Laughter. ] 

SENATOR CRAVEN: I thought that might have been an 
influencing factor. 

Senator Beverly, do you have any questions? 

SENATOR BEVERLY: Are you ready for a motion? 

SENATOR CRAVEN: Is there anyone in the audience 
who wishes to speak on this issue? 

MR. PALMER: Mr. Chairman, Members of the 
Committee, I'll be very brief. 

I'm Mark Palmer with the Mountain Lion Foundation. 
We are in support of Mr. Boren. 

I'm also representing the Planning and Conservation 
League, and I think you have a letter from the Defenders of 
Wildlife as well in the file. 

It's a delight to come to this Committee and 
support a Commissioner after a number of years, as Mr. Petris 
noted, that we have had some fights. 

Mr. Boren' s voice is still a minority, 
unfortunately, on that Commission, and we are hopeful that 
that can change. 



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In any event, Mr. Boren, I think, has shown you he 
has a thoughtful approach to Fish and Game. We don't always 
agree with him, but he has been proactive in terms of trying 
to work on the Endangered Species Act to move it forward to 
where we can resolve some of these difficulties. 

We think he * s a very good addition to the Fish and 
Game Commission, and we very strongly support him, and we 
hope that you will both send him with a recommendation to 
approve him on the Floor, as well as send a message to the 
Governor you want more appointees like this to the Fish and 
Game Commission, like Mr. Boren. 

Thanks very much. 

SENATOR CRAVEN: Thank you, sir. 

SENATOR BEVERLY: I'm pleased we got that on the 
record. 

I'm prepared to move the approval of the 
nomination. 

SENATOR CRAVEN: Anyone in objection? There is 



none 



We have a motion on Frank D. Boren. Call the roll 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 



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SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

SECRETARY WEBB: Vote is three to zero. 

SENATOR CRAVEN: Three to zero and to the Floor. 

Thank you very much, Mr. Boren. Congratulations, 



sir. 



MS. MICHEL: Senator Mello asked that we leave the 
roll open. 

SENATOR CRAVEN: Very well, we'll leave the role 
open. 

SENATOR PETRIS: So move. 

SENATOR CRAVEN: We'll leave the roll open. You'll 
pick up another vote or two there. 

Next is Bonnie Guiton, Secretary of the State and 
Consumer Services Agency. 

Good afternoon. 

MS. GUITON: Good afternoon. 

SENATOR CRAVEN: It's getting toward evening now, 
actually. If you lived in the south, it would be evening. 

We'll ask you to tell us why you feel you are 
qualified for this position, Ms. Guiton. 

MS. GUITON: Thank you, Senator Craven, Members of 
the Committee. 

I believe that my background in government service, 
business, education and other areas of the nonprofit sector 
has prepared me to meet the challenge of managing a diverse 



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state agency. 

The experience that I bring to state government is 
enhanced by an extremely competent team of directors and 
dedicated employees , and they ' re committed to helping me 
address the pressing demands placed on our Agency. 

My previous experience includes serving two U.S. 
Presidents in three separate appointments. Most recently for 
President Bush, I served as Special Advisor for Consumer 
Affairs and Director of the United States Office of Consumer 
Affairs. And during that time, I worked to develop 
broad-based coalitions to address consumer privacy and the 
accuracy of computerized personal information. I also 
convened the first national symposium on minority consumer 
issues . 

Furthermore, as a long-time resident of California, 
I have a deep-rooted appreciation of community and cultural 
diversity which I believe I've demonstrated serving on the 
boards of numerous nonprofit organizations, and they're as 
diverse in nature as the National Museum in the Arts, the 
Northern California Committee of the NAACP Legal Defense 
Fund, and the National Conference of Christians and Jews. 

I believe that an appreciate for diversity is 
particularly important for the Secretary of the State 
Consumer Services Agency, because it touches the lives of all 
Californians . 

But my personal philosophy is not to expand the 
state's bureaucracy, rather to make it more efficient and 



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74 
effective, and to enforce legislation already in place, and 
to encourage a shared ethic between business and government 
in avoiding excessive regulation which ultimately adds to the 
taxpayers' burden. 

I believe that it was Abraham Lincoln who said 
that: 

"The legitimate object of government 
is to do for a community of people 
whatever they need to have done but 
cannot do at all or cannot do so 
well for themselves in their 
separate and individual capacities." 
And then he further stated: 

"In all that the people can do 
individually as well for themselves, 
then government ought not to 
interfere. " 
So I'm grateful to Governor Wilson for the 
confidence he's placed in me during the past ten months, and 
I look forward to the opportunity to work with you to do for 
those who cannot do for themselves. 
Thank you. 

SENATOR CRAVEN: Fine, thank you, Ms. Guiton. 
Senator Petris . 

SENATOR PETRIS: I'd like to have the privilege of 
making the motion, since she's from my district. 

But before that, I have a question or two. 



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SENATOR CRAVEN: Very well. 

SENATOR PETRIS: Does Lincoln's quotation encompass 
environmental protection? 

MS. GUITON: Absolutely. 

SENATOR PETRIS: What is the Earth Conservation 
Corps? 

MS. GUITON: The Earth Conservation Corps is a 
relative new organization that was established to get young 
people involved in conservation work and to do it on a 
volunteer basis, so it w.as — the concept was that it be all 
private funding and no government funding, and that it would 
be working in cooperation with industry and with young people 
to do, you know, needed conservation work. 

Very similar to our Conservation Corps. 

SENATOR PETRIS: Is it a national thing? 
I 

MS. GUITON: Well, it was to be a national 

organization. It sort of went on hold when I got pulled to 

California. 

But it is still an organization that's waiting to 
take off, and there's still fundraising efforts going on on 
behalf of it. 

SENATOR PETRIS: Were you able to make any impact 
on the President? I know you served two Presidents. 

MS. GUITON: Right. 

SENATOR PETRIS: On President Bush and Consumer 
Affairs? 

MS. GUITON: I believe so. There were a couple of 



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areas we identified where consumers were not being well 
served. One was, we really took on the issue of privacy, 
which we consider to be one of the most significant consumer 
issues of this decade and, certainly, well into the next 
century. 

And the — and so I testified on behalf of 
consumers for a couple of issues related there, which include 
caller identification, also the Fair Credit Reporting Act. 

It's my belief that somehow or another, consumers 
really do not understand how information on them is used, or 
how to protect themselves from having information used by 
unscrupulous individuals. 

The other is that minority consumers really do not 
understand consumer laws, and they don't understand what 
rights that have accorded to them. And so I convened a 
symposium at the White House on minority consumer issues. 

It's kind of interesting, because I was asked if 
minority consumers were different than other consumer issues, 
and the fact of the matter is that they are not, but poor 
consumers tend to pay more because they don't understand the 
rights that are accorded to them, and oftentimes, then, don't 
get the protections. So I tried to infiltrate many of the 
nonprofit organizations, community-based organizations, and 
all ethnic groups to be able to get information to those 
places where those individuals will go so that they 
understand what their rights are. 

SENATOR PETRIS: Are you doing the same thing in 



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the state? 

MS. GUITON: Yes, we're making the same efforts 
here. I think it's even more critical in a state like 
California, with the kind of diversity that we have, and so I 
believe it's very critical here. 

SENATOR PETRIS: Are you putting out helpful 
information in the form of brochures that are — 

MS. GUITON: We're doing some of that, Senator 
Petris, but I believe that we have to have more first-hand 
contact with consumers, you know, because of the various 
languages that are spoken. If you look at Southern 
California alone, and we are often citing some 90 different 
languages . 

So, our approach is to try to also use community- 
based organizations and work through consumer organizations 
to get to people that we are not usually able to get through 
to. And also to increase enforcement so that they're being 
protected. 

SENATOR PETRIS: How about the foreign language 
media, some newspaper and radio? 

MS. GUITON: Yes, we're making attempts to get to 
those as well. 

Budget constraints are giving us some difficulty, 
obviously, but it is certainly — there has been information 
put out in various languages. We're told by some of those 
communities that one form of language may not reach all of 
their community because there's so many different ones. So, 



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we're making every effort to try to reach those — all those 
various categories of individuals who may not understand 
English or be able to read English. 

SENATOR PETRIS: You've had a distinguished career 
in business before you went into government. 

Are you encountering any conflicts with your former 
business pals in being on the other side of the table now? 

MS. GUITON: Absolutely not. What we try to do, 
and one of the first things I did when I was in Washington, 
was to form some coalitions with industry and with consumer 
organizations so that we bring people together who normally 
don't sit down and talk to one another, and to get them to 
understand that there's a need to work together, because it's 
in the best interests of business to have well-informed and 
happy consumers. And for consumers, you know, they want 
quality goods and services. 

So, it's, you know, it's a win-win situation if we 
can get them to work together. And I find a willingness on 
the part of many of them to do that. 

SENATOR PETRIS: Thank you. 

SENATOR CRAVEN: Thank you. 

Senator Beverly, do you have any questions? 

SENATOR BEVERLY: No questions. 

SENATOR CRAVEN: Let me ask, does anyone in the 
audience wish to testify or comment? There appears to be 
none. 

Senator Petris . 



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79 

SENATOR PETRIS: I asked to make the motion, not 
only because she's from my district, but I've known her and 
admired her, and respected her for many years, and I'm happy 
to put the motion in favor of confirmation. 

SENATOR CRAVEN: Senator Petris has moved. 

Call the roll, please. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti . 

SENATOR CRAVEN: We'll leave the roll open. 

Congratulations, Doctor. 

MS. GUI TON: Thank you. 

SENATOR CRAVEN: Did the Chairman say that 
Mr. Aubry was not with us? Oh, he is here, very well. 

Come up, please. We didn't want you to think we 
were overlooking you, but I heard him say something, and 
quite frankly, I wasn't paying that close attention. 

This is Lloyd Aubry, who's Director of the 
Department of Industrial Relations. 

We'll ask you, Mr. Aubry, why you feel you're 



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80 
qualified for this important post? 

MR. AUBRY: Well, I feel that I'm qualified for the 
position based both on my background and my past and current 
service in the Department over the last six or seven years. 

I have been practicing labor law, I've been in 
labor relations, ever since I got out of law school in 1985. 
I also served in the U.S. Department of Labor for three years 
in the early 1980s. 

In 1985, I was appointed by Governor Deukmejian as 
State Labor Commissioner, and during my four years in that 
position, I think I did a number of things that demonstrated 
my commitment to the Department, to the Division, and to the 
constituencies that are served by it. 

I added a number of positions to enforcement. I 
rewrote the Operations and Procedures Manual. I issued a 
number of publications to inform the public about some of our 
programs . I implemented the discrimination procedure that is 
currently being used to handle discrimination based on sexual 
orientation by the Labor Commissioner, and I also instituted 
a settlement conference procedure that speeded up the manner 
in which claims are handled before the Labor Commissioner. 

I was appointed Director about ten months ago. And 
I think that my service since then, both in respect to 
various programs within the Department, as well as the 
appointments that have been made to the various divisions, 
demonstrate my fitness for the position. 

When I was first appointed, the Division of 



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81 
Apprenticeship Standards had zero funds from the General Fund 
and was to be supported solely by fees generated from the 
apprenticeship community. I became convinced that this was 
not workable and convinced the Governor to agree with the 
Legislature and fund the Apprenticeship Standards Program out 
of the General Fund with $2.5 million. 

Later I convinced the Governor to sign AB 64, which 
appropriated $1.3 million for the support of apprenticeship 
programs . 

In the Division of Occupational Safety and Health, 
you'll recall that that — our program was rated number one 
in the country by a private organization. I appointed or had 
the Governor — asked the Governor to appoint Dr. John Howard 
as head of Cal-OSHA. He's both a doctor and a lawyer, and I 
think has been very well received in the safety community. 

We've also, since I was appointed, gained 
legislation to increase Cal-OSHA penalties by 700 percent. 
And this spring, we will be implementing a high hazard 
prevention program, which is to target high hazard industries 
in an attempt to improve their safety records . 

The Division of Workers Compensation, as you know, 
the Governor appointed Casey Young as head of that 
organization. Just before Christmas, Mr. Young and I 
appeared before the Governor and convinced him that the 
across-the-board cuts that were going to be allocated to the 
Division of Workers Compensation should not be implemented 
because of the effect they would have on implementation of 



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the 1989 Reform Act. 

We have over the past few years increased staffing 
in the Division of Workers Compensation, such that in all but 
about one or two offices in the state, it is possible to get 
a hearing in a timely fashion before one of the Workers 
Compensation Judges. 

When I was first appointed, I also began working 
with the Industrial Medical Council to attempt to staff that 
organization up and get it running. And I think that I've 
developed a good relationship with them. 

Finally, I also became involved in the lawsuit that 
had been filed by the California Applicants Attorneys 
Association, and we've been able to settle that lawsuit 
involving venue and screening of applications. 

Finally, with regard to the Division of Labor 
Standards and Enforcement, my old agency, that is the 
organization, frankly, about which I have the most concern. 
We did -- the Governor did appoint Vickie Bradshaw as the new 
Labor Commissioner, who, I understand, is the first woman 
ever appointed to that job. 

Because of the fact that the Labor Commissioner's 
office is funded totally from the General Fund, it has taken 
the largest hit in terms of budget cuts and has lost a great 
deal of positions. We tried to implement a number of things 
which we hope will increase our effectiveness in enforcement. 

We've attained twelve positions from the Employment 
Development Department, which are federally funded, to 



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increase our enforcement effectiveness. We're looking at 
funding some of the Workers Comp. enforcement activities of 
the Labor Commission out of the Revolving Fund under Labor 
Code 62.5, which is supported by employer contributions. 

I've also instituted a program where, when Cal-OSHA 
inspectors and/or Labor Commissioner inspectors are out in 
the field, they will be looking for each other's violations, 
so that we will increase our impact in the community. We're 
looking at whether or not we can implement some fee- 
generating activities to support some of our programs in the 
Labor Commissioner. 

We recently finalized regulations for labor 
compliance programs to allow local awarding bodies to develop 
programs that they can enforce, public works activities, 
which right now are enforced almost solely by the Labor 
Commissioner's Office. When a local awarding body implements 
such a program, that awarding body will be able to keep any 
penalties that are assessed. 

I also supported and asked the Governor to sign two 
bills at the end of last session: SB 955, which allows 
attorney's fees for minimum wages, and also liquidated damage 
lawsuits by private parties; and finally, AB 318, which 
requires growers to check the farm labor contractor's 
licensure status of any farm labor contractors that are hired 
by them. 

Finally, we've also instituted over the past few 
months a number of sweeps in both agriculture and in the 



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garment industry to increase our effectiveness. In fact, we 
have a sweep in the garment industry going on right now 
around the state, and we have DOSH field people on that 
inspection as well as some investigators from — fraud 
investigators from the State Compensation Insurance Fund. 
They've had a great deal of problems with garment industry 
employers who are not reporting their payroll. So, some of 
those inspectors are going along with our Labor Commissioner 
inspections . 

I think the actions that I've described, the 
appointments that the Governor has made which I have 
supported, demonstrate my commitment to the Department, and I 
request your confirmation. 

Thank you . 

SENATOR CRAVEN: Thank you very much. 

Senator Petris, do you have any questions? 

SENATOR PETRIS: Well, I had — 

MR. AUBRY: I did go to Stanford, Senator. 

[Laughter. ] 

MR. AUBRY: I didn't know if you knew that. 

SENATOR PETRIS: Okay. It helps. 

I had a barrage of tough questions, but when you 
indicated you urged the Governor to sign those two bills, I 
think they were both mine, I'm disarmed here. 

MR. AUBRY: I've urged him to sign your bills in 
the past, too. 

SENATOR PETRIS: Thank you. That's even more 



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important than the school. 

Can you clarify or expand a little bit on your 
statement regarding the Workers Comp. applicants now get a 
timely hearing before a judge. What does that mean? 

We've had so much difficulty in that area due to 
shortage of all kinds of personnel. We've had these horror 
stories, where you go into a regional office and — 

MR. AUBRY: Three hundred feet of mail. 

SENATOR PETRIS: — there's 300 feet of mail, 
unopened. And all of a sudden, we're being told that they're 
getting a hearing in a timely manner. What is that, five 
years? 

MR. AUBRY: Oh, no, no. 

The requirements are that when you file an 
applications for adjudication, that you see a settlement 
referee within 30 days, and that time limit is being met. 
And then, if you cannot — if the settlement referee or 
conference referee cannot resolve the case, then you go 
before a judge, and that happens within — 

SENATOR PETRIS: How does that compare to our past 
history. Is that a lot less time? 

MR. AUBRY: Yes. There was no question that all 
over the state, hearings were not being held in a timely 
fashion, and it was because of the staffing problem. In 
fact, in my travels around the state, many judges have 
suggested to me that we could have done without the 1989 
Reform Act in terms of the administrative changes. If we had 



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86 
just increased the staffing, things would have been a lot 
better. 

SENATOR PETRIS: Well, we tried to persuade the 
Governor of that at the time, but it didn't work. I was 
always convinced that increasing the staff, even the 
secretarial help, would have improved the situation 
enormously. 

Now, that 30-day current enforcement is down from 
what period before? 

MR. AUBRY: I don't really know. I understand it 
varied all over the state, but I think there's no question 
that — 

SENATOR PETRIS: Well, that's a big improvement, I 
know that . 

I had another question, but it escapes me now. 
I'll think of it before we finish. 

Thanks . 

SENATOR CRAVEN: Thank you. 

Is there anyone in the audience who wishes to speak 
in favor or in opposition, or on an ancillary subject? 

MR. REITER: I'm Charley Reiter. I'm Legislative 
Director of the State Building and Construction Trades 
Council of California. 

I have a brief or, perhaps, relatively brief, 
statement . 

We have some small qualms about our position, which 
is in support of Mr. Aubry, since Mr. Aubry's sponsor is the 



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present Administration, with which we not infrequently find 
ourselves at cross purposes. 

However, over the past months, prior to 
confirmation, the candidate has displayed a certain openness 
to the discussion of disputes and concerns with our various 
affiliate organizations as well as with ourselves, and also 
has been willing to reach the occasional decision concerning 
these problems. Along these lines, he has continued monthly 
open forum meetings with labor and industry that have proven 
intermittently fruitful. 

On the current national legal assault on 
construction labor standards affecting apprenticeship and 
other matters, he has fought to maintain our higher state 
requirements, at least until the dispute is settled one way 
or the other. During the state budgetary crisis, he has 
worked with labor to maintain the Apprenticeship Program at 
current staffing levels. 

In months ahead, particularly given the budgetary 
crisis, we all will face serious problems and needs. Our 
expectations of the Director will include the 
re-establishment of Cal-OSHA's ability to perform targeted 
inspections on high hazard industries, development of 
strategy and budget to ensure the continued payment of proper 
pay rates for public works projects, active leadership in 
exploring way in obtaining long-term funding of BAS . 

Finally, we believe a concept should be explored 
during the Director's tenure, which is the transition of the 



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present DIR to an expanded Department of Labor, along the 
lines of that already established in New York. We believe 
this is an imperative if California labor is to deal 
adequately with the vast technical sweep of the next century. 

In closing, we quote an observer who once noted 
that when a fellow you know obtains some lofty public office, 
you're glad for his sake but somewhat apprehensive for the 
future of the country. 

We're no longer apprehensive, but we will be 
watching and, hopefully, engaged in continuing dialogue with 
the Director and his staff. 

Thank you. 

SENATOR CRAVEN: That's almost as good as the 
Lincoln quote we had. 

[Laughter. ] 

SENATOR CRAVEN: The next gentleman. 

Mr. President and I had occasion to talk to this 
gentleman who you may recognize from a prior hearing, or 
prior hearings, and I felt that the point he that he made was 
very germane, and I thought this was the appropriate time for 
him to lay it out for us . 

Would you state your name, please. 

MR. TORRES: My name's Arnold Torres. I'm 
representing a number of Hispanic organizations concerned 
about the nomination but cannot oppose it. There isn't 
enough grounds there yet. 

I did want to bring very specific things to your 



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attention, and these are very important articles. This is 
the series of articles that the Sacramento Bee almost won a 
Pulitzer Prize for Honorable Mention. 

I've come before you often, just recently as last 
week. I'm feeling better, and I'm not going to wear out the 
welcome, but I do want to bring to your attention some 
concerns, and I'm going to make some recommendations. 

I think it's very, very important to raise these 
issues, bring them to your attention. And, as the 
representative of labor indicated, we must be very watchful 
of these things. 

The positions I will outline to you today are not 
ones in which we're asking that more money be given. We are 
at an extremely shortfall in every arena. But there are 
comments that were made in the article, in the series, that 
are very troublesome, and I will read them and bring them to 
your attention. 

"DIR Director Aubry and James Curry, 

deputy chief of DIR's division of 

labor standards enforcement, dispute 

that. " 
The dispute was that a farmworker indicated that he felt that 
the Department was on the side of the boss. Quote: 

"'They are on the side of the 

boss,' Sanchez said of his 

experience with the state." 

"Although it is not reflected 



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in DIR's policy manual, they ..." 
meaning Mr. Aubry and Mr. Curry, 

"say the agency has a special 
unwritten policy for farmworkers." 
The article goes on to indicate that Mr. Curry says 
that every senior deputy and every deputy in the state knows 
that farmworkers from filing cases deserve special — have an 
unwritten, but receive special accommodation, yet it's not in 
the policy. 

Another comment: 

"DIR investigators who 
participate in agricultural sweeps, 
who spoke on the condition they not 
be named, said the department makes 
it clear it is not interested in 
lengthy or involved agricultural 
cases . " 

"'Most of the time, the 
objective, if you could call it 
that, is to create a lot of 
commotion, make a big show of being 
out in the field,' said one veteran 
investigator. 'If you look at the 
kinds of cases we develop from 
sweeps, you won't see wage audits of 
growers or farm labor contractors 
affecting lots of workers.'" 



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91 
It goes on to make additional comments. 
This is from Mr. Aubry: 

" ' I totally reject that. 
Whenever I speak, whenever I've 
talked to these people I hear the 
same thing and I say, "Tell us where 
to go. Give us complaints." I can 
recall four or five years ago CRLA 
was complaining to us about minimum 
wage enforcement .... And we said, 
"OK, we'll work with you, we'll set 
up sweeps, you tell us where to go." 
We did, and we found one or two 
minimum wage violations . ' " 

"A Bee study of files from 90 
agricultural enforcement cases in 
1989 and 1990 revealed that few 
extensive investigations are 
pursued. " 
There's a number of other things. The bottom line 
was : 

"Why does the department do so little?" 
Lack of money. 

This is the last one. The more I read them, the 
more upsetting they are at times, but we have to put things 
in perspective, I think. 

"Discouraging Complaints. 



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"But under Aubry, revised DIR 
procedures have made filing and 
collecting unpaid wages even more 
difficult. " 
All of this is in front of you. 

There's one long discussion by the Nisei Farmer's 
League in Fresno suggesting that they increase the 
registration fees for contractors, and use the increased fees 
to put back into investigation. Mr. Aubry said no. He said 
that there was a law that Governor Wilson had signed about 
reasonable effort to check contract licenses before hiring 
people. 

Mr. Cunha, who represents the Nisei, indicated that 
it was budget cuts as to why Mr. Aubry said that they would 
not agree with that approach. 

The reason why these comments are troubling is 
because, you know, I've worked in the fields. You know, I 
apologize for not coming in shirt and tie, and I would think 
that someone to wears a shirt and tie as often as I do, 
people would not assume that that's my background. 

I'm a native of this city before many of you came 
to this city. And I worked in the fields in Old Town 
Sacramento. I used to go and catch the buses to go out and 
work. I was ten. 

I address these issues not because they're a 
personal concern, but because they've never been addressed. 
And when you find someone who's sensitive, the concern is 



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that sensitivity is being judged by today's standards. We're 
much more concerned about that fact that no one was sensitive 
for over 50 years. So, the sensitivity factor has to be 
increased; has to be more intense. There has to be more 
behind the sensitivity. There has to be some substance 
behind it. 

I think Mr. Aubry has got a very, very difficult 
job. He feels that if the complaints come to him, they'll 
try to do a better job. 

I think DIR has — credit has to be given to DIR. 
They are pursuing an 800 number on complaints. That's 
certainly an improvement. 

But I think when you look at this article, and you 
look at all the articles that have been done over 20 years on 
the farmworker, things have not improved. 

The federal regional person in charge of the 
Department of Labor, U.S. Department of Labor, feels that 
enforcement is largely symbolic because of the lack of 
resources . 

This series of articles, on the last page, makes a 
number of recommendations that they gleaned from the 
discussions they had in doing this five-part series. There 
is one, two, three, four, five, six, seven, eight 
recommendations that the article and the authors thought 
would make an improvement in enforcement. Some of them 
require monies. Our interest is not to necessarily pursue 
that approach. 



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94 

What I am here to try and impress upon you all 
today is to, as I attempted to do with Mr. Coyle as the 
Director of Housing, despite me submitting a letter late to 
Ms. Michel on that letter to Mr. Coyle, I would very much 
appreciate the opportunity for this Rules Committee to 
accompany Mr. Aubry's confirmation, which I assume is going 
to take place today from this Committee's recommendation, I 
would like to have his confirmation accompanied with a letter 
from you all requesting that, once again, the Department in 
this case submit a very clear plan of action to respond to 
the recommendations made, and to also propose what the 
Department and the Administration would do with its existing 
resources to improve the ability to enforce the law. 

One of the things that I think is very important, 
you know, I served in Washington for six years, and I worked 
with two administrations: a Democrat and a Republican 
administration. It's amazing. Everytime we would go to them 
to ask them to appoint more minorities, they would always 
tell us, "Give us names." 

And my response was, "I'm not an employment agency. 
I'm not a head hunter. The responsibility and the onus is on 
you to take that initiative and do it." 

And I think when it comes to complaints, the onus 
cannot be on those of us who are concerned about farmworkers . 
The onus must be in making sure that the government entity 
responsible for this established the credibility that would 
allow people to want to come forward. 



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95 

And I think because of the tremendous decades and 
generations of neglect in this arena, we have a tremendous 
row to hoe before we can really make the kind of substantive 
changes that some of us would love to see. 

It is my hope, and the hope of the organizations 
that I represent, that Mr. Aubry can begin to lay the 
foundation to establish the attitude that people do want to 
see a change in the lives of farmworkers, that there is a 
commitment, that there is a spirit of change here, and that 
we're not going to deal with it simply as a problem that is 
so large that we cannot overcome it. 

So, again, that is my recommendation to the 
Committee. I think, again, it's a positive one. It's not 
attempting to slam Mr. Aubry. It's an attempt to try to put 
the best possible light on a very, very difficult situation 
which this and many other articles have repeated underscored, 
but regrettably, very little has been done, regardless of the 
good intentions . 

So, I hope that at a minimum, we can do that. And 
I hope that Mr. Aubry will, in fact, be the person who can 
establish a foundation of change here. I think he knows the 
problems quite well. His comments in the paper, beyond 
these, reflect a knowledge of the problem, the extent of it. 

He serves on an agricultural commission that I had 
something to do with in creating the Immigration Act. He 
serves with two people that I worked against [sic] on the 
Immigration law: Mike Durando and Russ Williams. And I've 



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testified before them when they went down to Coachella. 

So, I think he is in an extremely, an extremely 
important position, serving on that national commission, and 
California's well represented. And I think if anyone can 
make changes, it's these three individuals; but certainly in 
the case of Mr. Aubry, he, I think, is very much in a 
leadership position, and I think he could do a lot more. 

So, again, I hope that my comments were taken in 
the proper spirit that they were made, and I hope that 
someone will make a motion to pursue that . 

SENATOR CRAVEN: Thank you, Mr. Torres, very much. 

Any comments? Senator Petris . 

SENATOR PETRIS: Can you comment on the 
recommendations in the article? Are you familiar with them? 

MR. AUBRY: Well, let's see. Some of them don't 
really apply to us. 

The first one: 

"Find out how many farm workers 
there are. Start now to improve the 
method by which the census in the 
year 2000 counts farm workers." 

One of the things, Arnoldo mentioned the Commission 
on Agricultural Workers, which I'm a member of, which has 
eleven members, actually. There's Messrs. Durando and 
Williams, Delores Huerta from the UFW, and Roger Mahoney, 
Cardinal Mahoney from Southern California is also a member of 
that commission. There are a couple of other California 



97 
people, Henry Voss, the Director of Food and Ag., is on it as 
well . 

One of the things we're doing in that is urging — 
one of the things I suspect we will do in our final 
recommendations, which are due at the end of this year, is to 
recommend that the Department of Labor pursue greater records 
in terms of counting farmworkers. There are a couple of 
studies that are now ongoing: the National Agricultural 
Workers Survey, the NAWs Survey. We're going to probably 
recommend that these continue and that more money be spent on 
counting farmworkers. 

"Create an interagency task 
force to pursue and prosecute 
unlicensed farm labor contractors." 

You know, we do work with the U.S. Department of 
Labor in terms of our sweeps. Arnoldo mentioned AB 318, and 
I thought the article kind of swept over it a little bit as 
well. The author of that bill was Assemblyman Polanco. In 
his press release on the bill, he described that as the 
toughest and most comprehensive state law in the country 
restricting the use of illegal, unlicensed farm labor 
contractors . He praised the Governor for looking past the 
parochial interests of certain agricultural groups. 

So, I'm not sure that the article was fair in terms 
of the steps that have been taken by the Administration in 
terms of trying to deal with the farm labor contractor 
problem. 



98 
One thing that we have decided to do is to do 
something* that has been done by the U.S. Department of Labor, 
not so much with regard to farm labor contractors, but rather 
— farm labor contractors, but with regard to child labor, 
and that is to do mail audits. You send out an audit 
request, and if the farm labor contractor does not respond or 



send you a document, then you go out and investigate the 



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person. But if they do send you a document, you can check 
it. You can decide that, perhaps, it needs further 
investigation. It's another mechanism for us to try to 
police better farm labor contractors in the field. 

Arnoldo mentioned the 800 number. One of the 
complaints that we've heard about our offices is that they 
are not open at the right times; that farmworkers are in the 
field and find it impossible to come to some of these 
offices. And that's true for some crops, not for all crops. 

But we decided to set up an 800 number which would 
be staffed in the afternoon and in the evening so that 
farmworkers could call at night. It would be staffed by a 
bilingual person. We could mail out complaints, advise the 
farmworker where to send the complaint, depending on where 
the work has been performed. 

I should also point out in terms of interagency 
task force, that the Governor created the Farmworker Services 
Coordinating Council, which is made up of the heads of the 
various state agencies. Its first meeting is a week — I 
guess it's next Monday. The Governor's going to kick it off, 



99 
and we're going to be looking at a lot of the problems that 
are described in this series as well as were described by 
Arnoldo. 

"Exempt farm workers from the 
Department of Industrial Relations ' 
current written policy of having 
farm workers identify the exact 
legal entity that cheated them . . . . " 
That's not — I'm not sure that's a totally 
accurate portrayal of what our policy is. 

The problem in any wage claim process in any court 
of law is getting jurisdiction over the right person, so that 
if you find that person guilty, you can enforce a judgment. 
If you don't have jurisdiction over the person, you can have 
a nice judgment, but it isn't going to matter because you're 
never going to be able to get the wages for that person. 

All we attempt to do is, the worker is obviously 
the best person, at least initially, to determine who the 
employer is. And we recognize that sometimes it's difficult 
to tell between a farm labor contractor and a grower. But we 
need to get that initial information first. We need to, at 
some point, come to a resolution and to who the legal entity 
is so that if, in act, we go to hearing, we have a decision, 
the decision's appealed and it goes to court, you can get 
jurisdiction over the right employer, and you can get money 
through the court enforcement procedures if need be. 

One of the things that we're going to do, and it 



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was one of the sections of the article that Arnoldo read, was 
the notion of special procedures. I think that there's a 
legitimate complaint there that our procedures, while they 
may be unwritten, should be in writing while they exist. 
They should still be in writing. 

What I've directed the Labor Commissioner to do is 
to put some written procedures in place to give some special 
protections for migratory labor. One of the things that 
we're considering trying is a pilot project in which we would 
allow farmworkers to testify at our Labor Commissioner 
hearings by phone . Already they ' re doing that at the 
Unemployment Insurance, the UI Board. I'm not sure how far 
we want to expand that in our Labor Commissioner hearings, 
but I think in the case of farmworkers who are migratory, it 
makes sense to make that effort. 

"Modernize the way DIR's Bureau 

of Field Enforcement conducts 

agricultural investigations and 

establishes investigative 

priorities . " 
I'm not quite sure what that means. We do about 30 
or 4 sweeps, which is a series of investigations over a two 
or three day period. Probably one-third to one-half of the 
sweeps are in agriculture. 

Arnoldo mentioned that the synonymous investigators 
say that, you know, we're not looking for in-depth 
investigations. Frankly, I have to dispute that. 



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I'm not going to dispute that some people might, 
for some reason, get that, but I will tell you that whenever 
I met with those investigators, I told them that we were 
looking for in-depth investigations. 

We — one of the things that I did when I was Labor 
Commissioner was to try to monitor the productivity and the 
activities of field investigators. And so, I developed a 
form, and I wanted to find out: how many inspections people 
did; how many complaints they issued; how many citations they 
issued; how much money they assessed; how much they 
collected. 

And some people got the idea that, I think — and I 
think it was wrongly gotten — that, you know, you had to 
have so many investigations to be considered doing a good 
job. I don't know how many times I told them that if you've 
got a big in-depth case, and it's taken you a lot of time, I 
don't care if you're down in the number of investigations. 
I'm interested in finding good cases and getting people's 
money to them if they're owed the money. 

So, I guess I have trouble understanding what 
"Modernize the Bureau of Field Enforcement" means, and I do 
dispute, at least personally, that any message was ever sent 
that in-depth investigations should not be pursued. 

I think in my opening statement I mentioned a 
number of things that we're trying to do to improve our 
enforcement, and perhaps that'll respond to the comment here. 

"Build more permanent farm 



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worker housing . . . . " 
You know, from my travels all over the country at 
hearings, I wish I could do that, but it's not in my 
jurisdiction. 

But I think that the -- one of the things that the 
Farmworkers Services Coordinating Council of the Governor is 
going to do is be addressing that very issue. 

Senator Roberti, I saw your bill that you amended 
recently to put more money into housing. 

The other things that really don't apply to me: 
"Fund the efforts of 
community-based organizations 
organizations to provide a fuller 
range of adult education programs 

ft 
• • • • 

And, 

"Create regulatory controls for 
. . . toxic pesticides . . . . " 
I mentioned the liaison and the mail audits. You 
know, one of the things I did when I was Labor Commissioner, 
and there were a couple of other bills that I worked on that 
I thought were helpful to farmworkers. There was a bill that 
was sponsored by CRLA, AB 2306. We — there's a Labor 
Commissioner's fund that allows the employees of licensed 
farm labor contractors to get wages if they can't find the 
farm labor contractor. And I worked on a bill with CRLA to 
expand that so that employees of unlicensed farm labor 



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103 
contractors can obtain their wages out of that fund. 

That fund is supported by contributions from the 
registration fee the farm labor contractors pay. 

I might also point out that AB 318, the bill that 
was mentioned also, contained an increase in the registration 
for farm labor contractors in their fee. 

SENATOR PETRIS: I thank you very much. 

I wish there were some way that the Department and 
other agencies that are involved, such as Housing, could 
really study this series of articles and try to make some 
really basic changes. 

The headline here, the title, is "Farm Workers 
Used, Abused and Discarded." And I don't think anyone who's 
been an observer of the farmworker scene for the last six 
decades at least, maybe more, disagree with that. We've just 
had a mind set that they don't count. They've always been 
excluded from protections in the law that are taken for 
granted by other workers . The creation of the ALRB was a 
revolutionary concept for that reason. They just always 
seemed to be shunted aside. It's part of the discarding 
process. They're expendable. They get sick. 

The Analyst ' s Report sometime back indicated that 
if you want to get sick because of your employment in 
California, go work on a farm. Be a farmworker. You'll get 
sick real fast. The percentage of those who get sick on the 
job is very high compared to others. They couldn't even find 
number two, it was so far down on the list. 



104 

You know, there's a whole bunch of things. You 
can ' t turn it around over night . 

I would urge you to really go into these reports. 
I guess you probably already have. 

MR. AUBRY: I have; I've read them. 

SENATOR PETRIS: I'm sure you're familiar with 
them. 

There's a lot of areas where you could be, because 
your attitude, I think, has been good as Labor Commissioner, 
trying to improve the lot of the people over whom the 
Department has jurisdiction, and there ought to be an 
increased effort as much as possible. 

It's really, really disgraceful. I've carried 
legislation in several of these areas. Housing, when I did 
housing, I remember there were 10,000 or 12,000 farmworkers 
living in holes in the ground in San Diego County alone. 

MR. TORRES: Still are. 

SENATOR PETRIS: That's still the case? 

SENATOR CRAVEN: Still there. 

SENATOR PETRIS: That's not acceptable. 

I know Housing isn't your department, but it seems 
to me that maybe this coordinating council will do something. 

MR. AUBRY: That's what I was going to mention. 

SENATOR PETRIS: That's just not acceptable, you 
know, in our state in this year in history. We ought to work 
real hard to eliminate that. 

I had a bunch of bills on housing for farmworkers. 



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105 
Most of them didn't get anywhere. The prior Governor, even 
with the support of the Farm Bureau and other groups, vetoed 
a bill I had to provide low interest loans to farmers to put 
up the housing. I thought it was unfair to tell the farmer, 
"You go out and build all this housing." Well, he can't do 
that . But with low interest loans and a revolving fund at 3 
percent or so, it was ideal thing. He vetoed it. 

I don't understand that. We've got to get away 
from that attitude. 

Thank you. 

SENATOR CRAVEN: Senator Beverly. 

SENATOR BEVERLY: No questions. 

SENATOR CRAVEN: Anyone in the audience? Yes, one 
other gentleman. 

MR. CURTIN: Thank you Mr. Chairman, Members of the 
Committee. My name is Dan Curtin. I'm the Director of the 
California State Council of Carpenters. 

We want to indicate our pleasure at the appointment 
of Mr. Aubry to the position of Director of the Department of 
Industrial Relations. We feel that he's knowledgeable in our 
area of need and labor relations. 

We also feel that the appointment of Mr. Young is 
an indication that we ' re going to have people in this level 
of government who are familiar with our concerns, and that 
we ' re going to get an even-handed approach to the problems . 

We encourage you to confirm this nomination. Thank 
you. 



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SENATOR CRAVEN: Thank you. 

You are, in effect, replacing Mr. Hanna? 

MR. CURTIN: Sort of. The Secretary-Treasurer is a 
different position, but it's — 

SENATOR CRAVEN: Yes, I remember. 

MR. CURTIN: I'm now the Director, so it's a little 
obscure, but to some degree, yes. 

SENATOR CRAVEN: Very good. I doubt if it's 
obscure. 

Do you wish to sum up, Mr. Aubry? 

MR. AUBRY: I thank the Committee for the 
opportunity to appear. I hope in my testimony that I've been 
able to demonstrate to you that I'm willing to listen to all 
constituency groups that come before the Department. I hope 
I'm able to respond to them in some fashion. 

I hope that the testimony that I've given you has 
demonstrated that. 

Thank you. 

SENATOR PETRIS: I have a question. Not a 
question, I would urge you -- we don't have time to go into a 
couple other issues, but one of them is the women's efforts 
to get a fair share of jobs in the construction trades. My 
friends in that industry deny that there ' s been 
discrimination, and I've met with them in my Oakland office, 
but I think there is a problem there. 

I'd like to move the recommendation that a letter 
accompany the recommendation for confirmation. Perhaps you 



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can help us draft it again. 

Would that be all right, Mr. Chairman? 

SENATOR CRAVEN: Yes. 

SENATOR PETRIS: I'd like to make the motion 
recommended by Mr . Torres . 

SENATOR CRAVEN: Very well. This would accompany 
the vote? 

CHAIRMAN ROBERTI: It would go along with it. 

SENATOR CRAVEN: Yes. 

SENATOR PETRIS: I don't think it has to be 
physically part of it. 

SENATOR CRAVEN: No, I understand. But this is in 
connection with what Mr. Torres brought to our attention. 

SENATOR PETRIS: Yes. 

SENATOR CRAVEN: Very well. 

Are you prepared to move, Senator Petris? 

SENATOR PETRIS: Yes. So move. 

SENATOR CRAVEN: Call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 



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Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

Four to zero. 

SENATOR CRAVEN: Very well. 

CHAIRMAN ROBERTI: Thank you, Senators. 
[Thereupon this portion of the 
Senate Rules Committee hearing 
was terminated at approximately 
5:20 P.M. ] 

— ooOoo — 
[The roll was left open on all 
the appointee confirmation votes 
where Chairman Roberti and/or 
Senator Mello had not voted. Both 
Senators cast "aye" votes on all 
the confirmations.] 



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CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of 
the State of California, do hereby certify: 

That I am a disinterested person herein; 
that the foregoing Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel 
or attorney for any of the parties to said hearing, nor in 
any way interested in the outcome of said hearing. 



hand th 



is c^>7- 



IN WITNESS WHEREOF, I have hereunto set my 
day of February, 1992. 




EVELYN J.'MIZA{_ 
Shorthand Reporter 



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185-R 

Additional copies of this publication may be purchased for $6.25 per copy plus 
current California sales tax. (Price includes shipping and handling.) 

Senate Publications 
1100 J Street, B-10 
Sacramento, CA 95814 

Make checks payable to SENATE RULES COMMITTEE. 

Please include Senate Publication Number 185-R when ordering. 



^5oo 



HEARING 

SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

WEDNESDAY, MARCH 4, 1992 
1:55 P.M. 



DOCUMENTS DEPT. 

Mi3 2 6 I992 

SAN FRANCIi/JO 
PU9UC ' lo RARY 



189-R 



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Reported by: 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 
ROOM 113 
SACRAMENTO, CALIFORNIA 



WEDNESDAY, MARCH 4, 1992 
1:55 P.M. 



Evelyn J. Mizak 
2x Shorthand Reporter 



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11 
APPEARANCES 



MEMBERS PRESENT 

SENATOR DAVID ROBERTI , Chairman 

5 SENATOR WILLIAM CRAVEN, Vice Chairman 
II 

SENATOR ROBERT BEVERLY 

SENATOR NICHOLAS PETRIS 

SENATOR HENRY MELLO 

STAFF PRESENT 

CLIFF BERG, Executive Officer 

PAT WEBB, Committee Secretary 

i 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

II 

ALSO PRESENT 



JACQUELINE BRADFORD, Administrator 
Tax Preparer Program 

THERESA ANN PARKER, Deputy Secretary 
Health and Welfare Agency 

JOHN D. SMITH, Deputy Director 
Office of Administrative Law 

CLARK E. WALLACE, Real Estate Commissioner 
Department of Real Estate 



Ill 

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INDEX 

2 

Page 

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Proceedings 1 

4 

5 Governor's Appointees; 

6 JACQUELINE BRADFORD, Administrator 
Tax Preparer Program 

7 [.Department of Consumer Affairs 1 

8 Qualifications 1 



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Experience in Department of Motor Vehicles 1 

California Lottery 1 

Program 2 

Revocation of Registrations 2 

Less Time to Resolve Consumer Complaints 2 

Outreach Program 3 



, 5 Questions by SENATOR MELLO re: 



Simplification of Tax Forms 3 

Use of Electronic Filing System 

for Filing Taxes 5 

Motion to Confirm 5 

Committee Action 6 

THERESA ANN PARKER, Deputy Secretary 

Health and Welfare Agency 6 



Qualifications 7 

Background 7 

24 Department of Benefit Payments 7 

25 Department of Finance 8 
Service on Conservancies 8 



Representative of Administration for 
Realignment Negotiations 



IV 



- Guiding Principles of Agency 9 

3 Questions by SENATOR MELLO re: 

4 Administration's Cutbacks in GAIN Program 9 

ii 

5 Problems with GAIN Program 10 

6 Funding for Child Care Programs 11 



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Attempt to Transition People from 

Welfare to Work 11 

Need to Provide Incentives 13 

Questions by SENATOR PETRIS re: 

Governor's Source of Information for 

Policy Decisions 14 

Reasons for More People Moving to California 14 

Blaming Victims for Failure of Policies 15 

Welfare as Permanent Way of Life 15 

Responses 16 

Immigration Quote Inaccurate 16 

Department of Finance Report on 

Percentage of Taxpayers Vs . 

Percentage of Tax Recipients 16 



AFDC Fastest Growing Sector 16 

Ways to Change 16 

il 

2i Proposal of Gap and Grant Reduction 16 

22 | National Work Program 17 

23 Program in Administration's Proposal 

as Part of Federal Waiver Request 17 



Prospects for Getting Waiver 17 

Congressional Budget Office Report Shows 

Recession as Major Reason for AFDC 

Population Increase 18 

Variation Among States 19 



Legislative Analyst's Study of 
Incentives to Move People Off Aid 

Demographic and Societal Issues 

Request for Current California Figures on 
Average Length of Stay on Welfare 

GAIN Program 

Percentage of Goal Funded 

Original Estimate of Cost Projections 

Basic AFDC Grant 

Cost of Housing by Geographic Area 

Request for Average Cost of AFDC 
Housing in San Diego 

Motion to Confirm 

Committee Action 

JOHN D. SMITH, Deputy Director 
Office of Administrative Law 

Qualifications 

Questions by SENATOR MELLO re: 

Positions on Governor's Overturning 
Director's Decisions on Two Occasions 

First Instance 

Second Instance 

Motion to Confirm 

Committee Action 

CLARK E. WALLACE, Real Estate Commissioner 
Department of Real Estate 

Qualifications 

Background in Real Estate Family 

Activity in Real Estate Industry 



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Service in Department of Real Estate 34 

Revenues of Department Off Significantly 34 

Market Turnaround by May 25,1992 35 

Statements in Support by SENATOR PETRIS 35 

Questions by SENATOR CRAVEN re: 

Presidency of CAR 35 

Acquaintances in Oceans ide 36 

Motion to Confirm 36 

Committee Action 37 

Termination of Proceedings 37 

Certificate of Reporter 38 



1 

P-R-O-C-E-E-D-I-N-G-S 
— 00O00 — 

CHAIRMAN ROBERTI: Governor's appointees appearing 
today, Jacqueline Bradford, Administrator, Tax Preparer Program. 

Ms. Bradford, we'll ask you what we ask all the 
Governor's appointees, and that is why you feel you're qualified 
to assume this position? 

MS. BRADFORD: Good afternoon, Senators. My name is 
Jacqueline Bradford. I'm the Administrator of the Tax Preparer 
Program, and I appreciate the opportunity to appear before you 
today . 

My qualifications for this position include spending 
the last ten years in state service in increasingly responsible 
positions. I was initially assigned to the Department of Motor 
Vehicles as executive assistant to the Director. My 
responsibilities there included overseeing the satisfactory 
resolution of constituent complaints referred to the Director by 
Legislators and the Governor's Office. In addition, I assisted 
in the development of the first Customer Relations Unit in that 
Department with a direct reporting relationship to senior 
;|management . 

I later transferred to the California Lottery, where 
I managed the Winner Awareness Program in the Public Affairs 
Department. This effort was geared toward maximizing 
opportunities to publicize million dollar winners at minimal 
cost to the Lottery. 

During my last two years at that department, I also 



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managed the administrative functions of the Public Affairs 

Department. My primary assignment was to establish fiscal and 

■ 

.personnel accountability within that unit, and I effectively did 

ISO. 

In June of last year, I moved into my present 
jlposition at the Department of Consumer Affairs as the Tax 
Program Administrator. Our program currently regulates 30,000 
tax preparers and tax interviewers. As Administrator, I intend 
to focus the program's efforts on more effective enforcement of 
ithe consumer protection statutes governing this program. Under 
the strong and innovative leadership provided by Director Jim 
Conran and his senior management team, I believe we can greatly 
improve the level of consumer protection historically provided 
!by the program. 

As a tangible example of that belief, during fiscal 
year 1990-91, the program revoked one tax preparer's 
registration. During this fiscal year, we have worked with the 
Attorney General's Office to successfully revoke the 
registration of six preparers. We have an additional eight 
cases pending which are expected to result in revocation, and we 
will continue to file cases as the year unfolds. 

We have also reduced the time required to resolve a 
typical consumer complaint from nine to twelve months less than 
a year ago, to a current average of one to two months. We're 
moving forward with legislation which, if approved, will enable 
us to take both criminal and administrative actions where 
appropriate against unregistered or unscrupulous tax 



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practitioners . 

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We also intend to design and implement an aggressive 

consumer outreach program to educate Californians so that they 

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are fully aware of their rights as consumers and the protections 
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afforded by our program. 
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While we've also been successful in establishing a 

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good working relationship with the industry, our primary 
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objective has been clearly articulated by our Director. The 

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protection of California consumers is now the Tax Preparer 

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Program's top priority. If confirmed, I will continue to 
aggressively carry out that mandate. 

I'd be pleased to answer any questions you have about 
our program or my suitability to fill this position. 

CHAIRMAN ROBERTI: Are there any questions of Ms. 
Bradford? Senator Mello. 

SENATOR MELLO: You're targeting preparers and the 
clients . 

One of the things that I read recently, or last 
year, is on the tax forms themselves. My question really is 
whether or not you tried to ask for more simplification of the 
tax form? 

What happened, I think Consumers Union or somebody 

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sent in a typical situation of income and amount of deductions 
land so forth, to H&R Block and parts of the Big Eight and 

others, to see whether or not what kind of answers they got 
i back. And they got eight different answers on the amount of 

taxes owed, and the range was several hundred percent difference 






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between one and the other. 

This concerns me that people like that cannot agree 
on a uniform — on a question that should have, I think, the 
same answer. I'm not questioning their qualifications of the 
preparer . 

I think that the problem lies in the forms which make 
them very complex. 

My question is, are you working with the State 
Franchise Tax Board and also maybe the Internal Revenue Service 
to see whether or not you can contribute to some uniform tax 
form? 

And the other thing is, a lot of people feel that the 
state income tax should be a percentage of your federal tax, you 
know, by just having it simplified so you don't have to file 
another form. You'd merely pay a pro rata share of what you owe 
the federal government. 

I don't say I support that fully, because some states 
have more oral depletion allowance than others . 

I'd like to hear your comments on that. 

MS. BRADFORD: First of all, we have absolutely no 
input into tax policy as it's established. The Franchise Tax, 
we just don't have a relationship with them that allows us to 
have any input as to tax policy. 

We do — we do contact the Forms Division 
occasionally, and we have talked with them. This matter of 
simplification is something that has not been brought to my 
attention before. 



5 

I am aware of that news story you're referring to f 
and it's something that falls under Franchise Tax Board, so 
we ' ve never worked with them on it . 

I understand through my contacts with the Internal 
Revenue Service, however, that more than 50 percent last year of 
the taxes filed through companies like H&R Block, and by tax 
preparers generally, were filed through the electronic filing 
system. And people who file through that system generally use 
the computer programs , and it ' s cut the error rate at the IRS 
from something like 12 percent down to under two percent this 
year. Checking the returns they've received this year, it's 
below two. It was right at two last year. 

So, that is going to go a long way toward reducing 
the error rate in taxes . 

SENATOR MELLO: So you think we are making progress? 

MS. BRADFORD: I think we're making progress. I 
think it's probably a little slow, but the computer programs are 
catching on very quickly. And from what I've heard from the 
IRS, and they have really been my best gauge at this point, I 
would think that another year or so will make a tremendous 
different because electronic filing is the wave of the future. 

SENATOR MELLO: Thank you very much. 

MS. BRADFORD: You're welcome. 

CHAIRMAN ROBERTI: Any further discussion? Any 
further questions? 

Is there any opposition in the audience? 

SENATOR CRAVEN: Move Ms. Bradford. 



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CHAIRMAN ROBERTI: Senator Craven moves confirmation 
be recommended to the Floor. 

Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris. Senator Craven. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti . 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote is four to zero; 
confirmation is recommended to the Floor. 

Congratulations . 

MS. BRADFORD: Thank you very much. 

CHAIRMAN ROBERTI: The next appointee is Theresa Ann 
Parker, Deputy Secretary of Health and Welfare Agency. 

Senator Craven, I have to return a phone call. I 
will turn the gavel over to you. I shall be back shortly. 

We'll start by asking you what we ask all the 
Governor's appointees, and that is why you feel you're qualified 

to assume this position? 

i 

MS. PARKER: Thank you Mr. Chairman and Senators. 

i 

[Good afternoon. My name is Theresa Parker, and I want to thank 



7 
you for the opportunity to present my qualifications for the 
position of Deputy Secretary in the Health and Welfare Agency. 

Before I go into my qualifications, I just wanted to 
introduce my daughter, Shannon Parker, who's here with me today, 
and know that I have a very supportive family which I believe is 
always an asset for anyone who has a — to try to meet the 
difficulties of being successful in any demanding job. 

Going into my background, although not a California 
native, I did come to California very early in my childhood, 
when my father came to practice medicine and actually practiced 
medicine in Sacramento County in a rural part of the county. 
Growing up in the household of a country doctor, and later 
working at his office, I had an early introduction to health 
issues and the social responsibilities to citizens in our 
community, particularly citizens who were ill or economically 
disadvantaged . 

While attending college, I had the opportunity to 
pursue a different route of public service and became an 
employee of the State of California in a department that was 
within the purview of the Health and Welfare Agency, then the 
Department of Benefit Payments, which is now the Department of 
Social Services. 

Upon graduation, I moved to the Department of Health 
Services and had a number of analytical positions with 
increasing responsibility, primarily involving Medi-Cal policy 
and fiscal policy. 

In 1980, I had the opportunity to move to the 



8 

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Department of Finance, where I served for over a decade in the 

2 

^Department, working almost exclusively on health and welfare 
3 

jissues. Primarily the last six years, I was the Program Budget 

4 

[Manager for Health and Welfare and Environmental Programs. 



During my tenure in the Department of Finance, I 



! :„ 



orked on major issues having to do with Health and Welfare 
policy and fiscal issues, some of which included the 1982 
Medi-Cal reforms, staffing standards, and accreditation issues 
with the State hospitals and developmental centers, development 
of the GAIN Program, which happened to be the model by which the 
feds modeled their Federal Jobs Program after, and also the 
expansion of funding for AIDS care and prenatal care. 

In addition, I had the opportunity to work on the 
local government assignment and had — through that assignment, 
was able to be exposed the county fiscal responsibilities as 
they serve as our agent in the implementation of many Health and 
Welfare programs. 

Besides my role in Health and Welfare programs while 
at Finance, I also served as a Commissioner to the California 
Tahoe Conservancy and the San Francisco Bay Conservancy and 
Development Commission. 

Last year, I was given the opportunity to serve 
Governor Wilson as part of the Health and Welfare team under 
Secretary Gould. Upon arriving at the Agency, I was given the 
responsibility as serving as the Administration's representative 
in the negotiations and implementation of the major bipartisan 
legislation for state and local realignment of Health and 



9 
Welfare programs. 

As part of the Health And Welfare Agency's team, I 
share with Secretary Gould the guiding principles that we intend 
to use to move forward as far as Health and Welfare programs in 
the coming years, and those being to move to more preventative 
approach to health care services through government; to break 
down the barriers to improve services; to provide better access 
to primary prevention health care; and to promote 
self-sufficiency in relation to individual's capabilities. 

In closing, I recognize that these are difficult 
times, and there are complex issues before the Health and 
Welfare Agency, affecting the daily lives of many Calif ornians. 
I look forward to working cooperatively to help achieve the best 
possible solutions to these difficult tasks before us. 

I ' d be happy to answer any questions . 

SENATOR CRAVEN: Thank you very much, Ms. Parker. 

Do any of the Senators have questions at this time? 
Senator Mello. 

SENATOR MELLO: Thank you, Mr. Chairman. 

You mentioned you gave project GAIN a very glowing 
compliment, I guess, saying that the feds copies that program 
after what we had done here in California. 

I don't look at GAIN as being that successful. In 
this year's budget, how much did the Administration cut back on 
the funding for project GAIN? 

MS. PARKER: Actually, there's no funding reduction 
in the budget for the GAIN program. In fact, the budget 



i proposes to expand on a portion of the GAIN program: job search 

2 

!|workshops for AFDC recipients. And there is approximately $30 

3 

million of new funding, both General Fund and federal funds, for 

;that activity. 

SENATOR MELLO: I believe in reading the budget 
summary, I believe there are some cutbacks within the GAIN 
program. I forget now what categories. 

At any rate, I think I was not a supporter of GAIN, 
and I think the deficiencies are pointed out now by your stating 
that they're putting more money into the job search. 

The problem that I see was, when it originally came 
out, it allowed about two months for the recipient to find a job 
through a job search program. But they offered no assistance 
really in helping to enhance their skills, or point them in the 
right direction for finding a job. And then the recession comes 
along, and it's even more difficult to find a job. 

For example, child care for single parents on AFDC, 
if we're trying to get people off of welfare, the Governor, of 
course, wants to cut back 25 percent. And I don't know what the 
recipient is going to do facing that kind of cutback. 

My hope is that we can transfer people on welfare to 
jobs. In order to do that, we have to first find a job, train 
them for the job, providing the child care, provide 
transportation . 

And also secondly, as even the Legislative Analyst 
came out with their report here just a few days ago that people 
on welfare ought to be able to keep their grant while they're 



11 

finding a job in order to get more stable and to make the 
transition from welfare to a job. 

I just wondered what are your comments in that 
regard? 

MS. PARKER: Well, Senator, a couple of comments. 

One, the Governor's budget for next year proposes 
over half a billion dollars for child care programs, including 
some additional funding in order to implement recent legislation 
sponsored by Assemblymember Willie Brown, to expand that child 
care to AFDC recipients by being able to drawn down additional 
federal dollars for child care that's currently paid for by the 
Department of Education and wholly state expense. And by 
getting additional federal dollars, we'll be able to expand 
child care throughout to a broader group of children that 
currently are not eligible to receive government support. 

So, we are in the process of trying to expand child 
care and to target particularly AFDC recipients. 

With respect to welfare reform, the Governor's 
proposal is very much oriented to try to move people and 
[transition them off of welfare to work. And part of that 
proposal is to, one, have a variety of activities to provide, 
;for example, labor market information in the county welfare 
offices so that the information will be available for people 
about what jobs are available. But also from the standpoint of 
trying to provide them incentives so that there is — that the 
dollars that they can earn, that they are not penalized by 
having their grants reduced dollar for dollar for every dollar 



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that they receive in earned income. 
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So, by providing a gap between the amount eligible 



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for aid and the amount that they would have reduced by new 
income, it provides an incentive for people to go out and work 



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and get into the labor force. 

SENATOR MELLO: Would they require a federal waiver 
in order to do that? 

MS. PARKER: Some of the Governor's proposals require 
a federal waiver, yes, Senator. 

SENATOR MELLO: Let me ask you about child care now. 
Just some quick arithmetic, you say half a million dollars -- 

MS. PARKER: Half a billion dollars; five hundred 
million dollars. 

SENATOR MELLO: Going into child care? 

MS. PARKER: Correct. 

SENATOR MELLO: Five hundred million dollars, there's 
1.7 million people getting child care, counting the spouse and 
the children; is that correct? 

Based on your own statistics, I think it's about 1.7 
million total. 

MS. PARKER: Are you talking about the number of 
people who are on aid? 

SENATOR MELLO: On AFDC, yes. I think it ' s a million 
children, and 700,000 parents. 

MS. PARKER: One thing that I think it's important to 
point out, Senator Mello, is that for AFDC recipients, not every 
family would require child care. To the extent that a parent 



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went out to work, if the child was in school and the parent was 
working during school hours, they wouldn't need child care. 

SENATOR MELLO: I realize that, but I'm just saying, 
taking $500 million for 1.7 million potential clients, not all 
of them will be there, it comes to about $3 per year per person. 
And child care costs $200-800 a month, you know, in the private 
sector and the other public programs. 

So, I just hope, I think that's part of the key. You 
have to have child care; you have to have a way to get them to 
that job. But if we somehow neglect to provide the help, 
they're just going to keep dropping on welfare, and then we're 
finding that society's getting awfully more negative towards 
welfare for many reasons. We just don't provide the incentives 
for getting people off of welfare. 

MS. PARKER: One follow-up comment, Senator, that 
amount of money that I was referring to is basically for 
subsidized slots for AFDC recipients that do go out and work. 
The amount of money that they would pay for child support would 
be a disregard against the amount of dollars that they would 
receive for AFDC. So, to the extent that they spent that money 
for child care, it would be used as a disregard before any of 
their grant was reduced to offset the income received. So, 
those dollars are not counted in the 500 million that I was 
talking about. 

SENATOR MELLO: It's certainly a step in the right 
direction. I just hoe that we can be more successful than we 
have bene i the past with project GAIN. 



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Thank you . 

SENATOR CRAVEN: Thank you. 

Senator Petris. 

SENATOR PETRIS: I may have missed this. If so, I'd 
be happy to back off. 

I'm curious as to the inner circle in the Governor's 
shop on welfare, the whole welfare subject. I'd like to know 
who supplies him with information before policy decisions are 
made? Does that come from the Secretary of Health and Welfare? 
Does it come from the Finance Department, the shop that you were 
in before? Where does it come from? 

MS. PARKER: Well, I can't speak to all parties, but 
clearly the Health and Welfare Agency has responsibility for 
welfare programs, gives policy input to the Governor. 

SENATOR PETRIS: Well, I'm a little concerned because 
of statements he's been making. I know they make good copy, but 
they're just not supported by the studies that have been made. 

He ' s repeatedly said that our budget problems are due 
to the immigrants and AFDC. and people are pouring into 
California just to get on AFDC. 

Every study that I've seen shows that's just not the 
case. The most recent one on a national basis, examining the 
question of why people move from one state to the other, the top 
three reasons are all job-related. Number one, they're being 
transferred from one job to another by their own company. 
Number two, they're seeking a job in California, not welfare. 
And number three, they already have a job that's been arranged 



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before the move. 

You put those three together, and it outdistances all 
these other reasons, like the weather, and other conditions in 
California. 

I think the Governor's doing a great disservice to 
our program when he keeps repeating this old bromide that, if it 
weren't for the poor, we wouldn't have the problems. 

I'm sick and tired of having people blame the 
victims, you know, of our policies, especially the executive 
branch at both the national and local levels. I'm sick and 
tired of having them blame the victims for the problem. 

I don't know of any poor people that contributed to 
the cause of the recession. I don't know any poor people that 
have been running General Motors . General Motors is firing 
70,000 people, whatever that number is. I don't think that was 
done by anybody on welfare. 

And yet, you know, whenever some leader gets painted 
into a corner on the problem, well, we have too many people on 
welfare. The statistics just don't bear that out. 

Another bromide is, well, they've adopted this as a 
permanent way of life. I've seen studies going back 20 years, 
and there hasn't been one year where they have been able to show 
that the general condition of people on welfare is one of 
settling in permanently. I mean, the latest figures that I've 
seen for 1990, it shows the average is 25.5 months; the average 
time on welfare. In 1977, it was 38.6 months, so it's dropping 
rather than going up. 



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Yet, if you read nay of the comments made as answers 
to our budget problem, you run into these false statements time 
and again. 

That's why I asked, who is it that's feeding the 
Governor this stuff? Or does it come out of his head? You 
can't help me on that, I guess. 

MS. PARKER: Well, I can try to take a stab at it, 
Senator. 

I think your first comment about immigration, I think 
that's a misquote. I think the Governor — it was primarily a 
Times article, and we tried essentially tell people that that is 



not what the Governor had to say. 

Secondly, the point about AFDC being a contribution 
to the budget problems, I think, comes out of a Department of 
Finance report, looking at the percentage of taxpayers to tax 
receivers and acknowledging the growth in AFDC program, and 
forecasting projections of that through the year 2000. 

More specifically, though, some of your comments, I 
think that what we've tried to say is that it is one of the 
fastest growing programs that we have. It doesn't necessarily 
provide some incentives to work for individuals because, to the 
extent that they go out and earn a dollar, then a dollar of that 
is taken away. But we — 

SENATOR PETRIS: Should we change that? 

MS. PARKER: We've moved in that direction a little 
bit by trying to propose a gap, and that's what we've done by 
having a grant reduction. 



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SENATOR PETRIS: Well, we had the Work Program 
nationally, and one of Reagan's first acts as President was to 
kill it. He said, "What are we doing paying people who are 
already drawing welfare?" Well, these people were working; it 
was a transition. The working poor who are on welfare and were 
allowed to earn a certain level of income until the transition 
was complete. That was working beautifully. He comes along and 
he says, "What are we doing paying people on welfare? They're 
already getting money from welfare, now they're getting money 
from the job. " Down went the program. 

I see the same attitude here which — 

MS. PARKER: Senator Petris, that proposal is back in 
|as part of the waiver request that we had with the federal 
government to allow that work incentive to be part of the 
package, so that when welfare recipients go in and work, that 
they have the income disregard as part of the — one of the 
incentives. So, if they go out and earn money, they're not 
disadvantaged by it . 

We agree with you, and that's again part of the 
package . 

SENATOR PETRIS: What are the prospects of getting a 
waiver? 

MS. PARKER: We've had early — we sent a draft 
package back to the federal government. We've had discussions 
with them. One of our primary issues with them at the moment is 
the evaluation of the demonstration project and how that would 
be carried out. 



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We've had very positive discussions. We have not 

submitted a formal package to them yet, but we anticipate a 

positive response. 

SENATOR PETRIS: I think part of this is the long 

denial syndrome that the President went through, and I guess 

!part of it rubbed off on the Governor. This notion of 

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spotlighting the fact that AFDC is the fastest growing part of 

the program, without looking at the reason, also does a 

|disservice. 

The Congressional Budget Office says the reason is 

!the recession. That's why people are getting laid off. That's 

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why companies are closing down. That's why thousands of people 

are getting thrown out of work every month. It's the recession. 

It's not somebody's desire to be — preference to be on welfare 

as opposed to a job. 

And there again, I'd like to see some better 
understanding coming out of the Administration in recognition of 
that. 

I read from time to time there's a job opening at the 
Post Office, or that hotel in Chicago that opened up — I forget 
the number of jobs. But they got, I don't know, they got 
thousands of applicants that stayed up all night and got in the 
line at midnight, under bad weather conditions, just to be in 
line to get the job. 

Now, that shouldn't happen, because the notion that's 
being put out is, people would rather be on welfare than go to 
work. That's just absolutely untrue for the overwhelming 



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majority of Americans. 

Sure, there are — some people might prefer to do 
that, but it's not endemic. It's not the majority thing. Most 
people would rather be working. 

And to accuse them of sitting around and preferring 
to be on welfare on one hand, and not acknowledging that jobs 
aren't available on the other, just compounds the problem and 
makes it tougher for us to try to solve it, it seems to me. 

And to the extent that you're, you know, part of the 
operation in Welfare, I would appreciate it if you'd bear that 
in mind. If I'm wrong somewhere, I'd like you to point it out. 

There are other studies, too. It isn't just the 
Congressional Budget Office, that links a lot of these 
developments to the recession. 

MS. PARKER: Senator, I've looked at the CBO study, 
and I -- clearly, that's the indication they have, but I think 
it's a matter of almost look at it on a state-by-state basis. 

It ' s interesting when you look at the variation among 
states for the — even within the recipients on aid, you were 
talking earlier about the average length of time on aid; 25 
percent of the people on aid in Maryland are there for longer 
than three years. In California, 50 percent of the people on 
aid are there for longer than three years . 

So, there is a — you have to almost kind of look 
within states and not kind of make a general statement about 
broadly what's happening. 

The other thing to point out is that the Legislative 



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Analyst's Office had done a study last year looking at the 
incentives of -- to welfare recipients of moving off aid, and 
they had two comments . One of them was the comment that the 
program didn't provide a lot of incentive, again, because you're 
penalized; for every dollar you're earning, you lose a dollar. 
But also the fact that the major reason for people coming on aid 
is not necessarily what's happening with the economy, it has 
more to do with demographic and societal issues: the increase 
in the number of women of child-bearing age; the number of -- 
increase in teenage births; the number of births, period, to 
women. Those are really some of the major factors that are 
contributing to the growth in AFDC, as opposed to just what's 
happening with the economy. 

SENATOR PETRIS: What proportion does each bear? 

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MS. PARKER: I don't know that anybody knows that. 

SENATOR PETRIS: There's something from each source, 
I guess. 

MS. PARKER: I think what we're saying is that those, 
we believe, are the primary factors, as opposed to the recession 
being the primary factor. 

SENATOR PETRIS: So, do you think the Budget Office 
conclusions aren't accurate? 

MS. PARKER: Well, I think that they made some 
conclusions looking at the nation and — 

SENATOR PETRIS: Not state-by-state? 

MS. PARKER: Correct. And I think that you almost 
have to look at it state-by-state to see what ' s happening within 



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your state. 

The percentage of tee pregnancies varies by state. 
That would be a factor. 

SENATOR PETRIS: I know they're high in California. 
We know that . 

MS. PARKER: Correct. 

SENATOR PETRIS: Do you have the current figures for 
California on the average length of stay on welfare? You say 
that 50 percent are more than three years. 

MS. PARKER: Correct. 

SENATOR PETRIS: What's the average? Is this number 
correct, 25.5 months? 

MS. PARKER: Senator, I'd be happy to get that 
information for you. I don't want to say that it's correct. 

That ends up being a statement that, depending on how 
you word it, can mean a lot of different things. 

SENATOR PETRIS: Okay. 

MS. PARKER: I ' d be happy to get that information for 



you. 

SENATOR PETRIS: Yes, if you would, thank you. 

What about the GAIN program? I haven't heard much 
feedback since the latest effort on GAIN that was carried by 
Assemblyman Agnos . 

Did we have an experimental county or two to begin 
with, and then extend it to everybody, or is that now statewide? 

MS. PARKER: The GAIN program is statewide, Senator. 
It's — 



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SENATOR PETRIS: How's it doing? 

MS. PARKER: Well, the — it's under evaluation 
within — and the evaluation hasn't been completed yet. 

So, I think the Administration has proposed some 
changes to the GAIN program from the standpoint of making it a 
little bit more work-oriented than just education-oriented, or 
at least allow for welfare recipients who are going through GAIN 
to be able to move through both portions of the program at the 
same point in time, so that if they wanted to focus more on 
work-related experiences, that they wouldn't have to necessarily 
go through some education components if they wanted to focus on 
something that's going to help them get a job. 

We — the GAIN program is viewed by many people, 
depending on the county, as being a very positive program. It's 
never been a program that has been fully funded, so it's not 
available to all people who could be eligible for it. 

SENATOR PETRIS: What percentage of the goal has 
actually be funded? 

MS. PARKER: You know, I think that it varies almost 
by year and by the caseload. The GAIN has not received 

substantial increases over the years, but to the extend that the 

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caseload, depending on its eligible, we've not been able to 

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target as many people with fixed amounts of money. 

SENATOR PETRIS: I don't remember the original 
estimate of what it would cost, the projections. Do you have 
that? 

MS. PARKER: I don't have it in my head. I was 



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actually in Finance at the time that we did that, and that was 
six or seven years ago. 

I think we — our estimates were probably by now that 
we were going to be having substantial savings that we could be 
redirecting to probably take care of our fiscal situation. 
That's not materializing. 

SENATOR PETRIS: Why not? 

MS. PARKER: I think that at the time, in fact, the 
^Department of Finance analysis said that the GAIN probably -- 
jjwould probably cost more than it would save, but in the long 
jrun, that they felt that it was a meritorious program, and it 
was a -- and that resources should be targeted in this 
particular area. 

SENATOR PETRIS: How long is long-term? 

MS. PARKER: Long-term? 

SENATOR PETRIS: In the long run. You said, "in the 
long run" it would be plus. How long is "long run"? 

MS. PARKER: I think — 

SENATOR PETRIS: According to the estimate. 

MS. PARKER: — what I'm trying to say is that there 
were some people believed — that believed that by the sixth or 
seventh year of implementation, which we're in now, that we 
would be saving dollars more than we're expending, and that's 
not happening. 

SENATOR PETRIS: Is that partly due to a lack of 
funding in the first place? 

MS. PARKER: I think that the biggest reason is that 



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once the GAIN program went into effect, that there was a 
realization that there were some impediments to people going out 
and getting employment that people didn't initially see. Some 
of the impediments were, frankly, just basic skills, basic 
education. 

SENATOR PETRIS: It included training, though; 
didn't it? 

MS. PARKER: It does. 

SENATOR PETRIS: Those who get the training should 
have a better chance at it? 

MS. PARKER: Right, but as a result of sort of 
finding out that people needed some basic education, a lot of 
people are moved through the education component that wasn ' t 
visualized in the beginning. And instead of a greater 
percentage of people going into sort of job training, most 
people are going through education, which is more expensive, 
takes a long period of time. 

SENATOR PETRIS: To get back to the AFDC, do you know 
the figures for the basic grant for a woman and two children? 

MS. PARKER: Well, we usually, when we talk about a 
basic grant for a woman and two children, it's $633 a month. 

SENATOR PETRIS: And that's statewide? 

MS. PARKER: Correct. 

SENATOR PETRIS: It doesn't vary by region. 

MS. PARKER: Correct. 

SENATOR PETRIS: Is that person eligible for food 
stamps? 



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MS. PARKER: Yes and Medi-Cal. 

SENATOR PETRIS: And Medi-Cal. 

Have you lived in Sacramento a long time? 

MS. PARKER: Virtually all my life, Senator. 

SENATOR PETRIS: You went to school here, I know. 

MS. PARKER: Yes, correct. 

SENATOR PETRIS: Do you know of very many places in 
Sacramento where you can get an apartment for a woman with two 
children at below $600 a month? 

MS. PARKER: Senator, I remember that this was an 
issue that you raised last week with Secretary Gould. 

One of the things that we're trying to look at is not 
only what the cost of housing is by geographical area, but to 
see if we can't find some information out about what the average 
rent, or what rents are paid by people who are on AFDC. 

We have some old studies that show that the average 
rent paid by an AFDC recipient is in the $350 range, and so it's 
an indication that people are finding housing, or perhaps — 

SENATOR PETRIS: Is that a statewide average? 

MS. PARKER: Correct. 

SENATOR PETRIS: I ' d be curious. When Secretary 
Gould was here, I hadn't checked the papers, but I had somebody 
check the papers for me where I live in Oakland and San 
Francisco. I didn't see any at $350 for that size of a family. 

MS. PARKER: It is an average, Senator. 

I think what we're trying — what we would like to 
try to do is see if we could find some information about what 



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people are paying for rents, and whether or not we have the 
ability to do that by geographical location. 

SENATOR PETRIS: Yes, I'd be interested in San Diego, 
too, for two reasons. One, it's a metropolitan center, and the 
other, I know a person in the building who lived there once upon 
a time. 

Thank you very much. 

CHAIRMAN ROBERTI: Any other questions? Senator 
Craven. 

SENATOR CRAVEN: No, sir. We have not gone to the 
audience yet. 

CHAIRMAN ROBERTI: I guess I'm re-assuming the 
Chair, Senator. 

Is there anybody in the audience in support? In 
opposition? 

Any further questions from the Committee? 

SENATOR CRAVEN: Move Ms. Parker. 

CHAIRMAN ROBERTI: Senator Craven moves confirmation 
be recommended to the Floor. 

Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . 



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SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote if five to zero; 
confirmation is recommended to the Floor. 

Congratulations . 

Mr. John D. Smith, Deputy Director of the Office of 
Administrative Law. 

MR. SMITH: Good afternoon. 

CHAIRMAN ROBERTI: Mr. Smith, we will ask you what we 
ask all the Governor's appointees, and that's why you feel 
you're qualified to assume this position. 

MR. SMITH: Senator Roberti, Members of the 
Committee, I appreciate the opportunity to appear before you 
today . 

In March of 1986, I was appointed and confirmed by 
the Senate for this very same position. 

In October of 1990, I was appointed Director for the 
Office to fulfill the term of the last Administration. I then 
carried on as acting Director until May of 1991, at which point 
I was appointed Deputy again. 

In my six years at OAL, I have directed or been 



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involved in all aspects of the Office, and I believe my 
background and experience provides me with the requirements for 
this position. 

If you have any questions, I'd be happy to answer 
them. 

CHAIRMAN ROBERTI : Are there any questions of 
Mr. Smith? Senator Mello. 

SENATOR MELLO: Mr. Chairman, just a brief question. 

When you said you were involved in all activities of 
the Office, it just seems like here lately, the Governor 
overturned the Director of Administrative Law on two occasions. 
One of them being his decision on Proposition 103, the 
roll-backs, and the other one was four or five months ago, a 
rate increase that your Office, I guess, approved, and then the 
Governor had to overrule your Department . 

MR. SMITH: That's correct, Senator. 

SENATOR MELLO: Are you involved, and do you agree 
with the actions of your Department, or do you agree with the 
actions of the Governor? 

[Laughter. ] 

SENATOR MELLO: This is not a loaded question. I 
didn't read it from here, either. 

SENATOR PETRIS: Is this on the record or off? 

[Laughter. ] 

MR. SMITH: Well, there were two different 
circumstances . 

I would point out that my duties primarily now are 



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administrative. But I am involved, to a certain extent, in the 
legal decisions. 

The first instance, when we disapproved a regulation, 
it was because our Director felt that there was not the basis 
for an emergency. And the Governor overruled Mr. Garcia' s 
decision, stating that he felt that this was better off handled 
in the courts . 

In the most recent decision — 

SENATOR MELLO: What was your philosophical position 
on that issue? 

MR. SMITH: Whether or not — as to whether or not 
there was an emergency? 

SENATOR MELLO: Do you agree with the findings of 
your Department, or do you feel it was justified to being 
overruled by the Governor? 

MR. SMITH: No, I agree with our Director, certainly. 

SENATOR MELLO: In other words, you disagree with the 
Governor's position, I guess in overruling your Director. 

MR. SMITH: Well, the Governor in that instance did 
not really elaborate, so I wasn't — as he did in the second 
instance, when he overruled us. I don't know if he felt that 
Mr. Garcia' s decision was actually correct in that instance, or, 
as he did in the second, that he felt that Mr. Garcia 's position 
was correct, but that for other reasons he was going to overrule 
us . 

SENATOR MELLO: Let's go to the second one, the most 
recent one. 



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MR. SMITH: That involved — and again, I was not 
involved in all the discussions -- both the Calfarm case and 
Prop. 103 anticipates a hearing whereby an insurer can build a 
record to contest a rate in court. 

The way the Commissioner's regulations were 
structured, as I understand it, they put some limitation on the 
ability to build that record for the court. And Mr. Garcia felt 
that that was inconsistent with both Prop. 103 and the Calfarm 
case. 

And I agree with that decision. 

SENATOR MELLO: Do you agree — is Mr. Garcia the 
Director or a Commissioner? 

MR. SMITH: He's the Director. 

SENATOR MELLO: Do you agree with the Director's 
position then? 

MR. SMITH: I agreed that there is a legal — 
legitimate legal issue there. 

And I do not disagree with the Governors that this 
matter, perhaps, should be speeded along to the courts and let's 
get a resolution to this thing. 

SENATOR MELLO: The Governor's decision really 
overturned what the Director had done; is that correct? 

MR. SMITH: That's correct. 

SENATOR MELLO: So, I guess you feel both the 
Director and the Governor were right. Isn't that your position? 

MR. SMITH: Yes, in this instance, definitely. 

SENATOR MELLO: You ought to run for the State 



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[Laughter. ] 

SENATOR MELLO: Thank you. 

CHAIRMAN ROBERTI: Any other questions? 

Is there any opposition in the audience? 

SENATOR CRAVEN: Move Mr. Smith. 

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CHAIRMAN ROBERTI: Senator Craven move's Mr. Smith's 

confirmation be recommended to the Floor. 

Secretary will call the roll. j 

SECRETARY WEBB: Senator Beverly. 

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SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. , 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti . 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote is five to zero; 

confirmation's recommended to the Floor. 

Congratulations . 



32 

MR. SMITH: Thank you, Senator. 

CHAIRMAN ROBERTI: Finally, Mr. Clark E. Wallace, 
Real Estate Commissioner. 

Mr. Wallace, we'll ask you what we ask all the 
Governor's appointees, and that is why you feel qualified to 
assume this position? 

MR. WALLACE: Chairman Roberti and Members of the 
Senate Rules Committee, I'm pleased to be with you today and 
have an opportunity to help encourage you to confirm my 
appointment. 

Background-wise, I was born in the heart of Senator 
Petris ' s district, in Oakland, in 1933, into a real estate 
family. My grandfather immigrated from Salt Lake City in 1913, 
where he was practicing real estate; came to the state in 1917 
and went into the real estate business. 

My father graduated from the University of California 
in Berkeley in 1922, went into the real estate in 1924. He and 
Grandpa formed a firm on Grand Avenue in Oakland in 1928. 

I was born a few years later. Went to the University 
of California, majored in real estate; graduated there in 1955. 
And after a three-year stint in the United States Navy, came 
back into the family real estate firm in Oakland and Contra 
Costa County. 

CHAIRMAN ROBERTI: So you seem to have been nurtured 
on real estate. 

MR. WALLACE: I was born and raised into a real 
estate family, Senator. In fact, I was one of those programmed 



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kids of the '50s who did what their parents told them. My dad 
says, "You're going into the real estate business," and I went 
into the real estate business. 

Beyond that — 

CHAIRMAN ROBERTI: My father's a tailor. I don't 
know how to sew a stitch. 

[Laughter. ] 

MR. WALLACE: Oh, well, we all do a little stitching 
in our own way. 

Beyond that, I was a 33-year licensee, starting in 
1958 until I tendered my license when the Governor asked me to 
step into this job last May. 

I was active in the field of residential sales for a 
while, but very active in residential development as well as 
some commercial development in primarily Contra Costa County. 

I've also been active in the real estate industry. 
My dad at age 91, and Mom at age 92, are the oldest living past 
presidents of the California Real Estate Association. I went 
around with them in those early days and succeeded to the 
presidency of CAR in 1978-79, and into the presidency of the 
National Association of Realtors in 1986. 

I've served on Fanny Mae — I was Chairman of David 
Maxwell's Fanny Mae Advisory Board. I've served on as a member 
of the Board of Directors of World Savings and Loan, 
headquartered in Oakland, and also Allen Stein, former 
Secretary of Business, Transportation and Housing, appointed me 
as one of the founding directors of the nonprofit Bridge Housing 



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Group in the San Francisco Bay Area. 

So, I've had a reasonably active career in addition 
to my professional real estate activities in the real estate 
industry itself. 

As far as the Department of Real Estate is concerned, 
I have also been an appointee of both Governor Jerry Brown as 
well as Governor George Deukmejian on the Real Estate Advisory 
Commission. I served for a number of years for both of them 
until I had to step down because of the implications of the 
presidency of the National Association of Realtors. 

I have had the — a number of occasions to work with, 
be appointed by, prior commissioners. I've known nine prior 
commissioners since back in the late '40s, '50s, so I have a 
sense, particularly in the '70s and '80s, of what the Department 
is all about. 

In the nine months I've been in the job, of course, 
jl've gotten a lot better understanding. By and large, the 
^Department ' s in good hands. It isn't broke. I doesn't need a 
lot of messing around with, other than the usual things that we 
all are suffering from in state government, and that's lack of 
revenues . 

Real estate license exams or real estate renewals, 
particularly for sales associates and subdivision applications, 
the three primary reasons for revenues in our Department, are 
all off significantly. So, we are doing some belt tightening. 

Having said that, morale is good. The people have 
been cooperative, and because of prior experience both with NAR 



35 
and CAR in strategic long-range planning, in the first six 
months on the job, with the input of all at the request — at my 
request, the 37 3 employees in the six offices of the Department 
up and down the state, we have crafted a long-range plan 
together, which I think will make, in the course of the next 
three or four years, significant contributions to the betterment 
of the real estate practitioners and the real estate and 
consumers over which we have oversight. 

With that, I feel confident that the market will 
turnaround by May 25th. I have it on reliable authority, May 
25th, 1992, and that our revenues will go up again, and we'll be 
able to get back to work. 

I'd be happy to answer any questions you might have . 

CHAIRMAN ROBERTI: Senator Petris . 

SENATOR PETRIS: I admit to some considerable bias 
here. I've known Mr. Wallace for years, and we've been good 
friends. I've admired his work. 

At the proper time, I'd like to be given the 
privilege of making the motion. 

CHAIRMAN ROBERTI: Is there any opposition in the 



audience? 



Any further questions? 

You're going to get off easy, Mr. Wallace. 

SENATOR CRAVEN: May I? 

CHAIRMAN ROBERTI: Yes, Senator Craven. 

SENATOR CRAVEN: When were you President of CAR? 

MR. WALLACE: In 1978, right following Donald Wiedman 



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of your district, Senator, and all of 1979. 

SENATOR CRAVEN: I think that, frankly, the last time 
I think I saw you and heard you, you spoke in my home town, 
which is Oceans ide, at a meeting of realtors, I believe. 

MR. WALLACE: Yes. 

SENATOR CRAVEN: Do you have any friends in 
Oceanside? 

MR. WALLACE: Yes, I do. 

SENATOR CRAVEN: Is John Steiger one of them? He ' s a 



realtor. 



MR. WALLACE: Warner La Sardi, Claire Burgener. 
SENATOR CRAVEN: You're messing with the right 



people. 



MR. WALLACE: Well, that's why I mentioned them. 

[Laughter. ] 

SENATOR CRAVEN: Might as well start at the top. 

I'm happy to feel as Senator Petris does, and 
certainly he's going to move you, and I offer my 
congratulations . 

SENATOR PETRIS: Move the confirmation. 

CHAIRMAN ROBERTI: Senator Petris moves the 
confirmation be recommended to the Floor. 

Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 



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SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote is five to zero; 
confirmation is recommended to the Floor. 

Congratulations . 

MR. WALLACE: Thank you very much, gentlemen. 
[Thereupon this portion of the 
Senate Rules Committee hearing 
was terminated at approximately 
2:55 P.M. ] 

— ooOoo — 



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CERTIFICATE OF SHORTHAND REPORTER 



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I, EVELYN J. MIZAK, a Shorthand Reporter of 
i the State of California, do hereby certify: 

That I am a disinterested person herein; 
that the foregoing Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel 
or attorney for any of the parties to said hearing, nor in 
any way interested in the outcome of said hearing. 

IN WITNESS WHEREOF, I have hereunto set my 
hand this (J) day of March, 1992. 




'ELYN 
Shorthand Reporter 



ZAK S 



189-R 

Additional copies of this publication may be purchased for $4.80 per copy plus 
current California sales tax. (Price includes shipping and handling.) 

Senate Publications 
1100 J Street, B-10 
Sacramento, CA 95814 

Make checks payable to SENATE RULES COMMITTEE. 

Please include Senate Publication Number 189-R when ordering. 



HEARING 

SENAT^RULES COMMITTEE 

STATE OF CALIFORNIA 

to 




DOCUMENTS DZPT. 

MAR 2 6 1992 

SAN FRANCK- 
PU> ^RARY 



STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

WEDNESDAY, MARCH 11, 1992 
1:50 P.M. 



190-F 



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Reported by: 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 
ROOM 113 
SACRAMENTO, CALIFORNIA 



WEDNESDAY, MARCH 11, 1992 
1:50 P.M. 



Evelyn J. Mizak 
2x Shorthand Reporter 



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APPEARANCES 
MEMBERS PRESENT 
SENATOR DAVID ROBERTI, Chairman 
SENATOR WILLIAM CRAVEN, Vice Chairman 
SENATOR ROBERT BEVERLY 
SENATOR NICHOLAS PETRIC 
SENATOR HENRY MELLO 

STAFF PRESENT 
CLIFF BERG, Executive Officer 
PAT WEBB, Committee Secretary 
RICK ROLLENS, Consultant on Bill Referrals 
NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

MARY H. HAYES, Deputy Director 
Employment Development Department 

ANITA R. MACKENZIE, Deputy Director 
Employment Development Department 

JAMES G. PATTILLO, Deputy Director 
Employment Development Department 

THOMAS S. SAYLES, Commissioner of Corporations 



Ill 



INDEX 



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Proceedings 



Page 

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Governor's Appointees: 

Deputy Directors of the 

Employment Development Department 1 

MARY H. HAYES, Deputy Director 

Marketing Services 

Employment Development Department 1 

Background and Qualifications 1 

Responsibilities 2 

ANITA R. MACKENZIE, Deputy Director 

Communications 

Employment Development Department 2 

Background and Qualifications 3 

Dissemination of Information 3 

JAMES G. PATTILLO, Deputy Director and General Counsel 

Legal Office 

Employment Development Department 5 

Duties and Responsibilities 5 

Background and Qualifications 5 

Questions by SENATOR PETRIS re: 

Participation in Mass Layoff 

Statistics Program 7 

Statistical Division of Labor 

Market Information Division 7 

Legislation which Made Information 

Unpublishable under Sections 1094 

and 1095 of Unemployment Insurance Code 8 

Rationale for Legislation 8 

Federal WARN Act 10 

Publicly Stated Reasons for Companies 

Leaving State Versus Real Reasons 12 



IV 



Preliminary Notice of Closures 13 

Role of EDD in Alleged Mass Exodus 

from California 14 

Verification or Confirmation of 

Statistics 14 

No Tracking of Reasons for Leaving 15 

Source of Information 15 

Need to Have Statistical Information 

on Reasons Companies are Leaving State 16 

Council on Competitiveness 17 

Contradictory Information on 

Estimates of Job Losses 17 

EDD Information Based on Department 

of Labor Statistics 18 

Extension of Farmworker Unemployment 

Benefits after Freeze 18 

Refusal to Extend to Other Worker- 
Affected Categories 19 

Establishment of Farmworkers Services 
Coordinating Council 19 

Effect of IRCA on Hiring Practices in 

California 20 

Program for Hiring Disabled Persons 20 

Delays in Payments of Unemployment 

Benefits 21 

Department's Position on Paying 

Interest on Delayed Claims 21 

Reasons for Delays 22 

24 

Backlog of Cases at Unemployment 

25 Insurance Appeals Board 22 

26 Business Climate Problem 23 

27 Questions by SENATOR MELLO re: 

28 True Unemployment Rate in California 24 



Counting of Those No Longer Seeking 
Benefits 

Percentage of Working Homeless 

Plant Closures which Deny Employees 
Benefit Eligibility 

Payments in Lieu of Notice 

Percentage of Appeals Caused by EDD 

Denial of Unemployment Benefits Extension 
to Commercial Fishermen after Freeze 

Interpreation of Law on Eligibility 

Large Number of Displaced Workers Due 
to Closure of Military Bases in State 

Pursuit of Job Partnership Act Funds 

Questions by SENATOR PETRIS re: 

Defense Conversion Adjustment Program 

Ability of Individual Entities to 
Get Funding 

EDD's Offer of Technical 
Assistance in Filing Applications 

Motion to Confirm MS. HAYES 

Committee Action 

Motion to Confirm MS. MACKENZIE 

Committee Action 

Motion to Confirm MR. PATTILLO 

Committee Action 

THOMAS S. SAYLES 
Commissioner of Corporations 

Background and Qualifications 

Motion to Confirm 

Committee Action 



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Motion to Hold Roll Open 
Termination of Proceedings 
Certificate of Reporter 



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P-R-O-C-E-E-D-I-N-G-S 
--00O00 — 

CHAIRMAN ROBERTI: Governor's appointees appearing 
today. We have three Deputy Directors of the Employment 
Development Department. In an attempt to save time, why don't 
we have all three -- Mary Hayes, Anita MacKenzie, and James 
Pattillo — please come forward, and please indicate why you 
feel you're qualified to assume this position. 

Maybe we'll ask questions of all three of you at the 
same time. We'll start with Ms. Hayes. 

MS. HAYES: Mr. Chairman, Members, I am Mary Hayes. 
I'm here today to ask for confirmation as Deputy Director of 
Marketing Services for the Employment Development Department. 

First I will tell you about my background and 
qualifications, and then follow with a description of the 
position of Deputy Director of Marketing Services, and conclude 
with a brief summary of what I have accomplished in the past 
nine months . 

I have a degree in political science from California 
State University Sacramento. For ten years, I was the primary 
owner and chief executive officer of a small profitable 
corporation. I was responsible for all the fiscal and 
operational aspects of three retail stores, rental property, a 
consulting practice, and approximately 20 employees. 

I am a certified public accountant with three years ' 
experience in public accounting. My experience includes: 
auditing, accounting, tax, and financial analysis. 



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The Deputy Director of Marketing Service for the 
Employment Development Department, EDD, is responsible for the 
development and implementation of a statewide marketing plan 
designed to focus promotional activities on EDD's programs and 
jservices which encourage the economic development of California. 
The marketing vision includes: identifying customer needs, 
expectations and perceptions; serving as a resource to support 
EDD programs and services in meeting or exceeding customer 
expectations; and clearly positioning EDD as an effective 
business and employment partner. 

I have been in the position of Deputy Director of 
Marketing Services for the past nine months. During that time, 
I have worked with the task force to development the Department- 
wide strategic marketing plan. The plan has been approved, and 
we are in the process of implementing it. 

We have determined that by focusing our activities 
and resources on the employer community, we can best increase 
public awareness of EDD's programs and services. My experience 
as both an employer and a CPA working with employers has allowed 
me to bring a valuable perspective to my job. 

I'd be happy to answer any questions you have for me. 

CHAIRMAN ROBERTI: Any questions of Ms. Hayes? Not 
right now. 

Next we'll go to Ms. MacKenzie. 

MS. MACKENZIE: Good afternoon. I'm Anita MacKenzie. 
My role as Deputy Director of Communications at EDD requires 
experience in writing, research, media relations, public 



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relations, and dissemination of information. It also requires 
knowledge of internal and external audiences, and, of course, 
knowledge of the subject areas we deal with at EDD. 

My background, which I would like to briefly describe 
for you, offers experience in each of these areas. I have 
experience working in the media as a reporter, writer, producer 
for a local, all-news radio station. The other private sector 
[experience I have which qualifies me is a community relations 
position I held at Mercy San Juan Hospital in Carmichael. There 
I was in charge of production of in-house publications, 
everything from developing concepts, to writing the brochures 
|and announcements or newsletters, to completing the actual 
graphic layout and design. 

My public sector work began about ten years ago as a 
Senate employee when I went to work as press secretary for a 
Senator. I also worked more than five years for the Assembly 
Republican Caucus as media relations specialist, producing all 
of the radio news releases for the Members. 

Prior to EDD, I most recently served in the previous 
Administration as an assistant press secretary for the Governor. 

I believe that EDD ' s client groups -- claimants, the 
public, and employers — are being served well through the 
Communications Office. We are working hard to make sure that 
each of these groups has all of the information that they need, 
and that they receive it in a timely and accurate way. 

More than 100 news releases have been sent out since 
I started as Deputy Director of Communications. We've also held 



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several news conferences, announcing extending benefits for 
unemployment insurance claimants, announcing Job Training 
Partnership Act grants for the re-training of displaced workers, 
and for the creation of public service employment jobs. Many of 
these events have been coordinated with the offices of local 

lected officials and the private industry councils in the area. 
We have had effective publicity campaigns to announce help for 
the unemployed in disaster ridden areas, those areas affected by 
floods, freeze, and fire. 

The Communications Office is also involved in 
publicity campaigns to make the public aware of EDD ' s services. 
We highlight Disability Insurance Awareness Week, Hire the Older 
Worker Week, Hire a Veteran Week, and offer media campaigns for 
summer youth employment programs and employment of persons with 
disabilities . 

I am committed to ensuring that those who need the 
services of EDD are aware that those services are available to 
them. 

With that, I would like to offer to answer any 
questions that you might have. 

SENATOR CRAVEN: Very well, thank you very much, 

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Ms. MacKenzie. 

Do you want to ask your questions now, Senator 
Petris, or do you want to wait until we hear all three? 

SENATOR PETRIS: We started to go for all three 
first . 

SENATOR CRAVEN: Fine. 



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Next, please, this is James Pattillo. 

MR. PATTILLO: Mr. Chairman and Members of the 
Committee, my name is James Pattillo. As you know, I've been 
appointed as Deputy Director and General Counsel of the 
Employment Development Department. 

The Legal Office of the Employment Development 
Department, which I supervise, has a staff of 19 attorneys, 4 
paralegals, and 9 support personnel. The duties of that office 
include: giving legal advice to the Director and the staff of 
the Department; representation of the Department in 
administrative hearings; coordination with the Attorney 
General's Office regarding court proceedings involving the 
Department; drafting and review of contracts; drafting analyses 
and advice regarding legislation and regulations; and generally 
rendering legal advice as required by the Department. 

My qualifications for the position to which I have 
been appointed are as follows. I received my bachelor's and law 
degrees from Stanford University: my bachelor's degree in 1964; 
the law degree in 1967. I'm a member of the California State 
Bar, having been admitted to practice in 1967. I've been 
engaged full time in the practice of law for over 24 years. I 
practiced law in Salt Lake City, Utah, from 1967 until 1971, and 
Jin Santa Barbara, California, from 1971 until June of last year 
jjwhen I was appointed to the position at EDD. 

My private practice was a general business practice, 
with emphasis on corporate and partnership matters and business 
litigation. 



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Besides the California and Utah State Bars, I'm also 
admitted to the United States District Court for the District of 
Utah, the United States District Court for the Central District 
of California, the United States Court of Appeals for the Ninth 
Circuit, the United States Court of Appeals for the Tenth 
Circuit, the United States Court of Claims, the United States 
Tax Court, and the United States Supreme Court. 

My practice has given me experience in dealing with 
legal issues of varying types and in various contexts, 
including: document drafting and analysis; interpretation and 
analysis of statutes, administrative materials, and court 
decisions; representation of clients at administrative hearings; 
litigation from commencement through trial and appeal in both 
state and federal courts; advice to clients on options and 
possible courses of action based on analysis of fact situations 
and applicable statutes, administrative materials, and case law. 

During my practice, I acted as managing partner of 
two different law firms, and thus have experience with the same 
types of personnel, administrative and operational decisions, as 
are required in the administration of the EDD Legal Office. 

Rather than boring you with further details, I will 
stop this summary, unless there are any questions. 

SENATOR CRAVEN: Thank you very much, sir. 

We have three members of the same organization, each 
with their own particular speciality, so you can talk about 
matters fiscal, or communication, or law, I suppose, and then 
beyond that, perhaps. Or some good stories about Tom Hayes. 



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[Laughter. ] 

SENATOR CRAVEN: Senator Petris . 

SENATOR PETRIS: Thank you, Mr. Chairman. 

Let's start with Ms. Hayes. I'm told that we're the 
only state in the Union that doesn't take part in the mass 
layoff statistics program. I wonder why that's so, and if 
that's not in your shop, maybe one of the others can answer. 

MS. HAYES: I'm sorry, Senator Petris. That is 
something that's not in my shop. 

SENATOR PETRIS: Okay, whose shop is it? 

MR. PATTILLO: Senator Petris, I'm not sure whose 
shop it is, but that's a question that I've dealt with, so 
perhaps I can answer it. 

Statistics on plant closings are gathered by the 

Labor Market Information Division of EDD. They are published in 

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summary form. They are not published with regard to "John Doe 
is going to close John Doe's Garment Factory next week." 

SENATOR PETRIS: Or last week. 

MR. PATTILLO: Or last week. Well, it's supposed to 
happen in advance. 

The employer who is going to close is required to 
give notice that he intends to close a plant both to the local 
governmental agency where his plant is located and to Labor 
Market Information of our Department. 

The local government agency makes that information 
publicly available in an individual form: Joe's Garment Factory 
is going to close. 



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We take it into our Statistical Division, make a 
statistic out of it, and say: 15 plants closed last year. 

The Director prior to the current Director of this 
Department, Mr. Kaye Kiddoo, had legislation introduced and 
passed which made the information gathered by the Labor Market 
Information Division technically information collected by the 
Director in the performance of his duties. Once that happened, 
it fell under Sections 1094 and 1095 of the Unemployment 
Insurance Code, which say that the Director cannot publish any 
information which he obtains in the performance of his duties 
with certain very limited exceptions. 

SENATOR PETRIS: What if he just reads it in the 
newspaper? If he got the information from the newspaper, so 
then he adds it to the statistical compilation, is that still 
under those two code sections? 

MR. PATTILLO: If he read it in the newspaper, I 
don't think it would be information collected by the Director in 
the administration of his duties. 

SENATOR PETRIS: What was the rationale for having 
those two code sections enacted? Why did we want to do this? 

MR. PATTILLO: Those two code sections have been in 
the code since the very beginning of the unemployment insurance 
program. 

SENATOR PETRIS: How long ago? 

MR. PATTILLO: Since 1932 or '3. 

SENATOR PETRIS: I had the impression you referred to 
some recent legislation. 



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MR. PATTILLO: The recent legislation hooked the 
'plants closures statistics into 1094 and 1095; 1094 and '5 have 
been there since forever. 

SENATOR PETRIS: They're probably very narrow, aren't 
they? Probably deal with individual names of employees? 

MR. PATTILLO: Names, addresses, Social Security 
numbers, details of former employment, amounts of claims — all 
the information the Department collects. 

SENATOR PETRIS: This latest hook-up seems to be 
substantially different. It's more on a massive basis — number 
of plants or number of employees -- and nothing further; no 
names or Social Security numbers, or anything like that. 

Why should that be in the same category? I'm not 
arguing with you. I'm trying to find out why we did it. 

MR. PATTILLO: I'm not certain, Senator. I was not 
with the Department under the former Director when this was 
done. 

I am told that his concern was that the law requires 
plant owners to publish the notice if they're going to close 60 
days before they do it, that some plants might publish the 
notice -- like the recent instance with General Motors, where 
they were going to close either a plant in Arlington, Texas, or 
the Willow Run plant in Detroit. But then there was confusion 
about which one would close, and they finally closed Willow Run. 

Under the law, they would have been required to 
publish the notice as to both plants, because they intended to 
close one or the other. 



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SENATOR PETRIS: Is that a federal law? 

MR. PATTILLO: That's a federal law, and then they 
would only have closed one, but they would have published the 
notice saying: We may close both. 

And Director Kiddoo ' s concern was that in situations 
jlof that kind, if we were to give publicity to the information 
regarding several possible plants that might close, where really 
only one was going to close, it could create a false impression 
of the economy being in worse shape than it is, the employer 
being in worse shape than it might be, and that it would be 
better if we just let the local agencies publish anything they 
wanted to publish, and we stuck to putting out the statistics 
that we typically put out. 

SENATOR PETRIS: We don't have any requirement like 
that in state law on notice on plant closings? 

MR. PATTILLO: No, Senator. The WARN Act is federal 
law. 

SENATOR PETRIS: That covers it? I had similar 
legislation three or four years ago, which was defeated or 
vetoed, I forget which, but we didn't make it. The idea being 
to give notice to people and make adjustments because of the 
impact. If you get a great, big plant in a small town, it wipes 
out employment for the whole town and has a community-wide 
impact. And the purpose was to provide as much information as 
possible. That is being done under the federal statute. 

Do you also make a report to some federal agency, or 
just local? 



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MR. PATTILLO: I'm not certain, but I believe that 
the WARN Act only requires notice to the local governmental 
agency and to the state employment security agency, which is 
EDD, but not to the Department of Labor. I may not be correct 
about that. 

SENATOR PETRIS: Now, the information that other 
people get and disseminate would have to be after the fact, I 
gather. You know, the business climate survey done recently by 
the L.A. Chamber on how many businesses left the state, that 
wouldn't involve a problem with that statue because it's not in 
the preliminary notice category; is that right? 

MR. PATTILLO: I believe that's correct, Senator. 

SENATOR PETRIS: I still don't know whether there's 
any difference between what you described and the mass layoff 
statistics program. We're not doing that as a part of that 
national program. We're doing it under some other statute, 
apparently; is that right? 

MR. PATTILLO: I'm not certain of that. I know we 
received in inquiry from one newspaper asking for statistics 
under the WARN Act. The worker effected — I forget what the 
acronym stands for, but it's the advance labor layoff provision 
of the federal law. 

I looked into it. What I found was what I've told 
you. I'm not aware of a problem involving mass layoff 
statistics, other than that one. 

SENATOR PETRIS: Well, I'm told that, according to 
our staff, all the other states take part in that federal 



12 
program, but we don't. 

Is that because we do it on our own, or we're not 
doing it at all? I don't what's involved in the layoff 
statistics program except that it has to do with compiling the 
data on mass layoffs and plant closings and the reasons. 

I've found in the past that the reasons stated 
publicly for closing down of a plant, or moving out of the 
state, don't always comport with the truth. Sometimes companies 
who had some difficulties locally with the city council on 
zoning, or with labor, or somebody, will take a parting shot, 
and their headquarters in Tennessee has made a decision to 
consolidate, and they're pulling in people back to the 
headquarters. Has nothing to do with local conditions, but the 
public statement made by the local president of the company, or 
manager, says: "We're leaving because we've had too many zoning 
fights with the city," or, "We're leaving because labor costs 
are too high here. The unions are giving us a bad time." 

Then you probe into it, you find neither one of those 
had anything to do with the decision to leave. It wasn't made 
by the local branch manager; it was made by somebody back in 
their headquarters. 

I'm wondering if this statute is intended to flush 
out the true reasons so that we can have a better knowledge, you 
know, store of knowledge as to why certain things happen in our 
business world. But I'm groping, because I don't know what that 
statute provides for. 

MR. PATTILLO: We may be talking past one another. 



13 

If there is a mass layoff statistic statute, I'm not 
aware of it. The statute I am aware of is the WARN Act, the 
federal law regarding the 60-day advance notice of plant 
closure. 

I have been told by the reporter who called me that 
iall other states not only compile that information statistically 
but also with individual employer names, and make it available 
to the press. The reporter was most indignant that we did not 
compile that information other than statistically in California. 
I told him the same thing I've told you as to why we don't. 

SENATOR PETRIS: Is this a preliminary notice 
juncture that you're talking about? 

MR. PATTILLO: Yes, sir. 

SENATOR PETRIS: So the reporter wants to know in 
advance before it happens. 

MR. PATTILLO: And he wanted information on not just 
how many plants have left California, or have given the WARN Act 
notice, but who, which employers, where were they located, what 
communities, how many employees. 

We have information on how many employers and how 
many employees. We don't have the information, or we don't — 
we cannot publicly give the information on what employer, what 
town. 

SENATOR PETRIS: That's prohibited by the statute, 
but the federal statute? 

MR. PATTILLO: No, it's prohibited by the state 
statute which picks up these long-standing prohibitions in 1094 



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and 1095 — 

SENATOR PETRIS: And adds these other two. 

But since you weren't here at the time, you can't 
tell us why we did that. There must have been some good reason. 
I don't know what that would be. 

MR. PATTILLO: I assume there was one, but I can't 
tell you what it was. 

SENATOR PETRIS: We'll have to do some research on 
that, you and I both. 

MR. PATTILLO: Yes, sir. 

SENATOR PETRIS: Related to that is the business 

climate controversy that's been going on with the L.A. Chamber 

report and others who contend there's a massive exodus from 

California. 

Is there any role being played by EDD in that, one 
i 
way or the other, either being a resource agency to provide 

information on what's actually happening? 

The reason I ask that, there are contradictory 
reports. The L.A. Chamber makes certain allegations, and 
there's another study done in Palo Alto that blows it out of the 
water, or at least contradicts it. 

I wonder if people come to you for verification, 
confirmation, of statistics that are thrown around out there, 
which may or may not be reliable? 

MS. MACKENZIE: We do have a statistics program 
through our Labor Market Information Division. 

We offer the statistics. Other agencies and 



15 

individual entities — local governments -- take our statistics 
and do numerous things with them, and make them fit into 
whatever form they want them to fit. 

We do not track as a state agency, and I do not 
believe that any state agency does track the reasons that 
businesses are leaving the state. It is something that we are 
looking at, and it is of great concern to us, the number of 
businesses that are leaving the state, and we are -- but our 
role right now is simply to take the information the employers 
as they report to us the number of employees they have, and at 
the time they leave, they would do an exit report that simply 
would include statistical information. 

SENATOR PETRIS: It wouldn't include the reasons for 
leaving? 

MS. MACKENZIE: No. 

SENATOR PETRIS: Do you have authority to find that 
out under the present laws or regulations? 

MS. MACKENZIE: I don't know if we have the 
authority. 

SENATOR PETRIS: But when you track them, you ask 
certain questions, don't you? How do you get the information on 
the number of employees? 

MS. MACKENZIE: Through the tax form returns, the 202 
Form that is submitted by employers on a quarterly basis to the 
Employment Development Department. 

SENATOR PETRIS: Well, it seems to me there's a gap 
here. I'm trying to find out how we can close it. 



16 

There is a lot of concern about businesses leaving 
the state. I personally am not convinced that it's anywhere 
near the scope, the dimension, that the critics are claiming. 

I know the Governor's sensitive to it. He's vetoed a 
lot of bills on the ground that it would drive business out of 
the state; it might be a tax, it might be a new regulation, you 
know . 

On the other hand, I've never heard him complain 
about companies who leave here and go to Mexico so that they can 
pay 85 cents an hour instead of $15, or $16, or $17. Never a 
complaint on that. 

It seems to me if we had a statistical flow — a flow 
of statistical information that let everybody know why Company A 
is leaving for real, it would, first of all, help us assess the 
situation; and second, clear up the confusion that's caused by 
contradictory reports from different sources. 

Do you see what I mean? 

I don't know whether this would take a statute or 
not. It seems to me that could be done within the policy. If 
you have a form, exit -- what did you call it? Exit-something. 

MS. MACKENZIE: There are — the tax forms. 

SENATOR PETRIS: The final tax? Yes, maybe we could 
add a question on why don't you love us anymore? How come 
you're leaving California? 

You may get the truth, you may not, but it's a start. 
And I thought just from the surface here that a mass layoff 
thing might be intended in part to include that information. I 



17 
guess it doesn't. 

What about the new Council on Competitiveness that 
the Governor has formed? Is EDD playing a role in that? 

MS. MACKENZIE: Yes, the Director sits on a couple of 
the subcommittees of the Council on Competitiveness and is very- 
active and is very concerned about business retention in the 
State of California for the sake of jobs. 

SENATOR PETRIS: Do you know when their first report 
is due? 

MS. MACKENZIE: Shortly; April, I believe. 

SENATOR PETRIS: This Competitiveness Council has to 
do with our competition no matter where they are, I assume? It 
could be other states or foreign companies as well, foreign 
markets? It isn't limited just to neighboring states, why 
people move to Nevada or why they go to Mexico. It's much more 
broad than that; isn't it? 

MS. MACKENZIE: That's my understanding, why 
businesses — what we can do to keep business in California, 
period. 

SENATOR PETRIS: You handle the flow of — you're 
the communications person, so I guess if anybody knows it, you 
would, unless it's not part of the stream of PR releases. 

One of the things that troubles us from time to time 
is another thing of estimates on job losses. We seem to get 
contradictory information from different sources. Some of them 
are state sources; others are private. 

Can you comment on that at all? 



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MS. MACKENZIE: I can tell you that we contract with 
the Department of Labor to gather statistics from the Department 
of Labor, and we follow, generally speaking, Department of Labor 
guidelines for tracking such things as unemployment rates and 
job loss. 

SENATOR PETRIS: Department of Labor? 

MS. MACKENZIE: Uh-huh. 

SENATOR PETRIS: Anyone else? That's it? 

MS. MACKENZIE: Well, the Bureau of Labor Statistics 
within the Department of Labor. 

SENATOR PETRIS: That's within. So there wouldn't be 
conflicting reports coming out of that one agency, I don't 
imagine. 

MS. MACKENZIE: No. 

SENATOR PETRIS: Are there any other sources of 
public agencies that handle this information or generate it? 

MS. MACKENZIE: Not to my knowledge. Several 
agencies take our statistics and then do what they will with 
them for analytical reasons and for planning reasons. 

SENATOR PETRIS: Sometime ago the question of the 
problem of the farmworkers came up. We were all very concerned. 
They had a tough enough time in normal years, but remember the 
freeze? 

MS. MACKENZIE: Right. 

SENATOR PETRIS: Happily, a lot of them are now back 
at work and doing much better 

At that time, the EDD recommended extension of 



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unemployment benefits for them, but when other categories came 
up, they didn't make that recommendation. 

Was that a fiscal decision? 

MS. MACKENZIE: I don't know it — what exactly 
you're referring to. 

There was a need shown during the freeze for there to 
be extended benefits, and based on need, the decision was made 
to — 

SENATOR PETRIS: I don't recall the categories, but 
there were also other categories, groups of workers afflicted in 
some other way who had need for an extension, but that was 
denied. 

You don't recall that? 

MS. MACKENZIE: I don't recall. 

We have done several things for farmworkers and the 
farmworker community. During the time following the freeze, the 
Public Service Employment Program was established to create 
public sector jobs, to help tide people over until the new crop 
came in. The new crop came in about November; oranges were 
back; citrus growers were hiring again — 

SENATOR PETRIS: That was the primary area, yes. 

MS. MACKENZIE: Right, and we also have been 
instrumental in the establishment of the Farmworkers Services 
Coordinating Council, which held its first meeting just a couple 
of weeks ago, and that includes members from several departments 
that deal with farmworker issues. And it will be meeting on a 
regular basis in different areas to assess the different needs 



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of farmworkers and the farmworker community. 

SENATOR PETRIS: What's that called? Is that a 
council of some kind? 

MS. MACKENZIE: The Farmworkers Services Coordinating 
Council. It's through the Health and Welfare Agency. 

SENATOR PETRIS: Now, speaking of farmworkers, what 
impact has the recent federal reform -- remember the Immigration 
Reform and Control Act — had on hiring practices in California? 
You know, the employer's required to verify within three days 
the eligibility of each worker to hold a job in California. 
Have you had enough experience yet to tell us how that's working 
out? 

MS. MACKENZIE: I know that the Labor Market 
Information Division tracks such things and does surveys of 
employers to try to determine the impact of IRCA. I am not sure 
that anything conclusive has yet been determined. 

SENATOR PETRIS: Do you have any program in the 
Department for hiring of the disabled? 

MS. MACKENZIE: We do. We house the employment — 
the Committee for Employment of Disabled Persons, and we work 
|very closely with them in establishing policy, working with the 
employer community to make certain that employers adhere to 
^legislation like the Americans with Disabilities Act, and those 
'ikinds of federal regulations. 

SENATOR PETRIS: We've had similar legislation in 
California for quite a while. 

Mr. Pattillo, I'm curious about delayed benefit 



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payments in the workers comp. system — not workers comp; not 
injury, but unemployment benefit payments. 

A lot of times, those payments are delayed for 
unemployment or disability. It could be from maybe having the 
application denied originally, and then a subsequent reversal, 
and then it relates back to the original period after a lot of 
time has passed. It could be an error in some clerk's file, 
bureaucratic delays, et cetera. 

Apparently, there are so many of them in recent 
years, that the employees have been asking for interest payments 
on that claim when it's finally paid. 

Does EDD have an official position on paying 
interest? Do they recommend the payment of interest or not? 

MR. PATTILLO: I believe there was a case which 
ordered us to pay interest on particular — on a particular 
group of claims that were involved in that case. 

I believe that the Department has recommended to the 
Health and Welfare Agency that we consider what we should do 
about interest, because it doesn't just affect us. It affects 
welfare, and it affects work comp., and other agencies who pay 
benefits that may be delayed. And we didn't want to make a 
unilateral decision that could then be used as a precedent 
against other departments without involving them in the 
discussion and letting them have something to say about it. 

So, we have paid interest in the case where the court 
ordered us to. We think we probably should pay interest in — 
in cases in the future, but we've referred the matter to the 



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Health and Welfare Agency for a decision as to — for a policy 
[decision from them or from higher up as to what we should do. 

SENATOR PETRIS: You don't have authority in EDD to 
make that decision? 

MR. PATTILLO: I suppose technically we have 
authority to decide what are we as a Department going to do, but 
our concern was that that decision affects not only our 
Department, but also other departments throughout the state. 

SENATOR PETRIS: You also have a variety of reasons, 
I suppose. Some reasons, you'd pay interest, and others you 
wouldn ' t . 

MR. PATTILLO: Well, the largest source of delay is 
not actually within EDD. Within EDD, the delays might be a 
matter of a week, ten days, two weeks. 

The delays now are coming from the fact that we deny 
benefits, or we don't — or we say we'll only pay them at a 
certain level. The applicant doesn't like our decision. He or 
she appeals to the Unemployment Insurance Appeals Board. They 
have a backlog of 60,000 cases sitting over there. And they are 
an independent judicial body outside our Department, not under 
our jurisdiction. 

So, they are hiring new administrative law judges, 
and putting in a new computer system, doing everything they can 
to try to get back on top of their backlog, but in the meantime, 
the backlog exists. The cases are delayed, and at least — I'm 
passing the buck here, but there's nothing that we at EDD can do 
about that. 



23 

SENATOR PETRIS: That's okay. I'm just trying to 
find out. 

Sometimes interest is an additional inducement for 
the payer to move more quickly. Maybe we ought to make it more 
formal, a regulation or statute, to the extent you can trace the 
principle cause of the delay. Because it's normally beyond the 
control of the applicant himself or herself. They're just 
waiting for this process to keep moving. 

MR. PATTILLO: I know we'd certainly be happy if 
you'd put it in a statute that the Unemployment Insurance 
Appeals Board should pay the interest. 

SENATOR PETRIS: Well, it might reduce that 60,000 
somewhat . 

Just one more question of Ms. Hayes on the business 
'climate problem. Do you have any comments with respect to how 
EDD could help in that situation? 

MS. HAYES: Right now we're looking at working with 
advisory groups of the employer community and getting their 
feedback on how EDD can better serve them, specifically in the 
area of looking at providing them with job-ready applicants for 
jobs when they do become available, and finding out what jobs 
are — there are some jobs out there, and it's matching the 
applicants with the job. 

SENATOR PETRIS: That's one of your basic functions; 
isn't it? 

MS. HAYES: Yes, uh-huh. 

SENATOR PETRIS: Beyond that, do you learn anything 



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in dealing with the employers that might help counsel them on 
ways to be more effective in the things they do, maybe the 
[paperwork or something? You probably wouldn't get that much 
information. 

MS. HAYES: Not that I can think of a specific 
example . 

SENATOR PETRIS: Thank you very much. 

SENATOR CRAVEN: Any others? Senator Mello. 

SENATOR MELLO: Just a couple of follow-up questions 
from what Senator Petris was asking. 

One of them has to do with — Ms. MacKenzie perhaps 
can answer this. When the amount of employment was out in 
California, it's now estimated at 8.9 percent. 

MS. MACKENZIE: It's 8.7, Senator. 

SENATOR MELLO: Well, hopefully it went down. 

But the point I'm trying to make, I think this total 
is misleading as to the number of people out of work, because it 
no longer counts those that have exhausted their benefits. 
Those that are out of the system but still unemployed because of 
limitations placed on the benefits. 

Is that correct? 

MS. MACKENZIE: I don't believe so, sir. I believe 
that the unemployment — 

SENATOR MELLO: Let me ask you this. Do you count 

them after they have exhausted their benefits? 

i 1 

MS. MACKENZIE: You are counted as unemployed if you 
are actively seeking work. 



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SENATOR MELLO: How do you know they're seeking work 
if they're no longer coming into your office for — 

MS. MACKENZIE: Through a survey done by the federal 
government, the Bureau of Labor Statistics. 

SENATOR MELLO: So, is the 8.7 the total number of 
unemployed in California, or are there more? 

MS. MACKENZIE: It is an estimate of the number of 
unemployed. There is a 90 percent accuracy rate — or, 90 
percent confidence rate that — it falls within a range. I 
believe this month it's 7.7 to 9.0. I didn't bring that with 
me. 

SENATOR MELLO: I've read articles that I've been 
following because I'm very concerned. In my area, one of my 
counties had 18.3 percent, San Benito County, before a plant 
closure came in. I don't know what they're up to now. 

But I believe, based on information that is stated by 
the EDD Office does not count those that are no longer seeking 
benefits within the system. So therefore, in my opinion, the 
unemployment rate ranges higher to some degree than the stated 
rate by your Department . 

MS. MACKENZIE: The Department of Labor conducts a 
current population survey, which includes 4300 households in the 
State of California. And upon that survey and some other 
factors, the Department of Labor establishes what the state's 
unemployment rate is . 

SENATOR MELLO: When you say households, are you 
counting the homeless? 



26 

MS. MACKENZIE: I do not believe so. 

SENATOR MELLO: Do you know what percentage of the 
homeless are working? 

MS. MACKENZIE: No, sir, I don't. 

SENATOR MELLO: I've read it's about 60 percent. 

So, I think we're worse off than — even though 
you've lowered it by two-tenths of a percent, I think there's 
more unemployment here in California today than is stated by 
federal and state agencies. 

Mr. Pattillo, I'd like to ask you about — Senator 
Petris was asking you about the notification process for plant 
closures, and there's several areas. One is with the severance 
pay, but also, isn't there another way that plants can issue a 
notice in lieu of and lay off employees without any benefits, or 
any 60-day notification? 

MR. PATTILLO: I believe Senator Petris ' s question 
went to the WARN Act, which requires — it's a federal statute 
that requires an employer to give advance notice 60 days prior 
to the closing of a plant of a certain size. 

That notice doesn't say anything about, okay, you're 
going to close your plant. You're going to lay off 500 people. 
Are you going to give them severance pay? Are you going to pay 
them their accumulated vacation, their sick leave? It says 
nothing about benefits. All it says is, you have to give the 
notice and tell people this is going to happen. 

And then, the matter of what benefits are paid is a 
matter, perhaps, a labor agreement, or private contract between 



p 



27 
the company closing the plant and the employees. 

SENATOR MELLO: I had a bill in this regard last year 
that the CMA and other business interests opposed, and I believe 
your Department did also. 

What I was trying to establish, because this came 
about in Salinas, where Simplex Foods closed two plants. They 
gave this notice in lieu of, and made a severance pay type of 

ay to the employees, but that was counted so they couldn't be 
eligible then for unemployment insurance. 

MR. PATTILLO: There are horribly complicated 
provisions governing when you are laid off and you get a payment 
from your employer. If it's called one thing, we treat it as if 
you're not unemployed. Yet because it's a payment -- if you're 
given, say, two weeks' pay in lieu of notice -- well, you're not 
unemployed until the two weeks run out because you're still 
being paid for those two weeks. 

On the other hand, if you're laid off and given a 
severance payment of two weeks' money, you're laid off right 
now, and you can go down and file for benefits. 

SENATOR MELLO: This was notice in lieu of, so they 
gave them one weeks' pay, or something like that, so then when 
they went in to get their unemployment insurance, well, they 
were just not plain eligible. I don't know how that — 

MR. PATTILLO: It sounds like it was a payment in 
lieu of notice. 

SENATOR MELLO: I'll dig up a copy of the bill, but 
Senator Petris is right. This area needs some work in order to 



28 

protect the workers who are being laid off right now during this 
recession. Many are losing their jobs, and there are just not 
benefits there to provide help for them. 

The other thing you mentioned, backlog of 60,000 
efore the Appeals Board, which is out of your jurisdiction. 
jBut every single one of those appeals is caused by the EDD 
department, who enforce the regulations in such a way that 
people become denied of their benefits and they have to file an 
appeal . 

I'd like to know what percentage, you know, just out 
of your enforcement, administration by EDD, accounts — 
contributes a lot to these appeals? What percentage of these 
appeals are decided in favor of the appellants? 

MR. PATTILLO: I don't have an exact number for you, 
Senator. I believe it's a relatively small percentage. Those 
are cases in which we've said we can't pay you benefits because 
you didn't work at all. You have no wages in your base period. 
We can't pay you wages at the level you want because we're 
complying with federal law. The federal law says if you have 
wages at a certain level, you get benefits at a certain level. 
And the employee comes in and says, "I don't like that. I want 
the higher benefits." 

Basically, in every one of those cases, the 
Department, in all good faith and in all seriousness, has made 
the best call we can on the facts, and we've said we can't pay 
this applicant at all, or we can't pay them the amount they want 
because the law doesn't qualify them to be paid. 



29 
Now, obviously, those applicants all disagree, and 

that ' s why there ' s an appeal . But it ' s not as though we ■ re 

sitting over there saying, you know, "How many applicants can we 

throw out in the street today and not pay. " 

SENATOR MELLO: I'm not suggesting that. You're 

saying the law is here, but many times the interpretation of the 

law differs between different people. 

Like you may recall — I guess you did not recall, 

during the freeze period, also, the commercial fishermen in our 

area had no fishing, and they went to get unemployment benefits. 

And they went through, oh, lost their boats, lost their homes, 

I 
lost their automobiles. And they had — they were eligible, and 

they had paid in, but it was hard to justify that they were — 

the result of their layoff was due to the freeze, so the 

Department took a very -- the law is not there plain and clear. 

That's what I'm suggesting to you. 

I think if anything happens, you ought to opt on the 
side of the unemployed worker and not be so stringent in 
administration. I mean, if it's a call not clear enough in the 
law. 

MR. PATTILLO: I can tell you that those — the 
employment program representatives whom I have met and talked 
to — the actual people who stand behind the counter and make 
the decision, yes, you get benefits; no, you don't — those 
ijpeople are not in the pejorative sense bureaucrats. They are 
people who are very concerned about the applicants that come in 
front of them, and they are quite ingenious in finding a way to 



30 
somebody . 

Now, at the same time, we have the federal Department 
of Labor looking over our shoulder saying, "California, you must 
run your program in conformity with federal law, because if you 
don't conform, you lose your exemption from the Federal 
Unemployment Tax Act," and every employer in your state suddenly 
has to pay four times as much in unemployment tax. 

SENATOR MELLO: Right now in California, as you know, 
we have eleven military base closures. I have Fort Ord in my 
area, which is the second largest in the whole nation, largest 
in California. 

And Mr. Nagle's been very helpful in coming down and 
trying to set up transition programs. But I'm just concerned, 
if — and the result of the closing has nothing to do with what 
we in Monterey County did. It's a decision made by the 
military. 

But we have 17,000 troops leaving, going to 
Washington, and there's 13,000 other displaced workers directly, 
and another 5,000-10,000 indirectly. And I'm just saying that 
EDD ' s going to have to really provide a lot of help down there 
until we can get the transition and get those jobs back again. 

I just hope that you're compassionate and sensitive 
enough to come down and do a job that's going to help these 
people facing a loss of jobs. 

MS. MACKENZIE: May I respond, sir? 

SENATOR MELLO: Absolutely. 

MS. MACKENZIE: We are actively pursuing Job Training 



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Partnership Act funds for displaced workers for military base 
closures. I know here in the Sacramento area recently, we gave 
a $600,000 readjustment, retraining grant. 

We've had millions of dollars that we've doled out 
throughout the state for the purpose of base closure layoffs. 

We are — currently in Washington, D.C., our 
Department is represented there today and tomorrow to try to get 
ahold of some of the $150 million that the Department of Labor 
has set aside specifically for base closure layoffs. We had 
Originally gone to the Department of Labor and said the problem 
;is so severe in California, we such a large percentage of the 
military population in the nation, that we would like our fair 
share of those dollars. 

The Department of Labor wants us to come back now 
with specific programs and specific items that we could fund 
with that money. We are taking aggressive action to let 
individual employers know what they can do, to let military 
bases know what they can do to access this money. McClellan Air 
Force Base, I believe, has a proposal back to the Department of 
Labor right now to access some of that $150 million. 

So, we have an ongoing program to try to get as many 
federal dollars as are available to us for the very purpose that 
you raised. 

SENATOR MELLO: I hope so. 

Incidentally, Mr. Nagle has agreed to either come 
down or send somebody on April 24th, down to Monterey, and 
appear before Mr. Sibert or Ben Williams from the Office of 



32 

Planning and Research to lay out the programs the state has, the 
State of California has, to help with the transition in the 
military base closures. 

You're asking for a proportionate share of the 
dollars, bear in mind that out of 43 base closures, 11 of them 
joccurred in California. It's a disproportionate share, so we 
ought to get a disproportionate oversupply of money to take care 
of the way they cut more bases here than anyplace else, 
proportionately . 

Thank you. 

SENATOR CRAVEN: Thank you. Senator Petris . 

SENATOR PETRIS: Oakland, my home town, recently got 
a bunch of money to help retrain. One of them was for Nabisco. 
Nabisco employees, the whole plant shut down there. I don't 
remember the number. I saw it in the paper. I was happy to see 
it. It's going to several designated companies for their 
employee retraining. 

In that connection, I wanted to ask about an article 
that was in the Bee just the other day about the Defense 
Conversion Adjustment Program, that's partially what you're 
talking about. And it says that out of 150,000 available, we 
only have 6 million. And the state is applying to get more, as 
you indicated, but the statute apparently provides for 
individual employers, and nonprofits, and unions also to get in 
and apply, but they have to go through the Department. And the 
article says that one of the organizations participating, a 
local nonprofit agency, says that the state told them that 



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they're going to put in a bid for the state as a whole, and 
therefore, it blocks them from doing it. 

Can you comment on that? 

MS. MACKENZIE: Yes. 

The state had, as I mentioned to Senator Mello, asked 
for a percentage share of the dollars. The Department of Labor 
said, "No, come back to us on a program by program basis." 

SENATOR PETRIS: Now, is that $150 million the total 
available nationally? 

MS. MACKENZIE: Yes. And the service delivery areas, 
local private industry councils who we work with very closely on 
these job retraining efforts were invited to attend a conference 
in February in Burlingame, where Employment Development 
Department and Department of Labor, and Department — Bureau of 
Statistics got together. Told local service delivery areas that 
— of the decision made by the Department of Labor; told them 
jjwhat they had to do to proceed further to get the money; made 
them aware that they were eligible as individual entities to go 
back and try to get that money. We offered any technical 
assistance through EDD that we could. 

We have people that we actually send down to these 
different agencies that want to get this money and help them 
fill out the applications, because we have the technical 
expertise. We're doing everything we can. 

The entity that you mentioned that was quoted in that 
particular article did not attend the conference in Burlingame; 
although the offer was extended to them. 



34 

SENATOR PETRIS: They don't know how to fill out the 
form. 

Thank you. 

Thanks, Mr. Chairman. 

CHAIRMAN ROBERTI: Thank you, Senator Craven. 

Are there any other questions of the three 
appointees? 

Is there any opposition in the audience? 

Then do I hear a motion? 

SENATOR CRAVEN: Mr. Chairman, I'd like to move Mary 
H. Hayes, Deputy Director of the Employment Development 
Department . 

CHAIRMAN ROBERTI: Senator Craven moves Mary H. 
Hayes, Deputy Director of the Employment Development Department. 

Any discussion or debate on the motion? Secretary, 
call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 



35 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote is five to zero; 
confirmation is recommended to the Floor. 

Congratulations . 

Senator Craven now moves — 

SENATOR CRAVEN: I'd like to move Anita R. MacKenzie, 
Deputy Director of the Employment Development Department. 

CHAIRMAN ROBERTI: — Anita R. MacKenzie, Deputy 
Director of the Employment Development Department, do pass and 
to the Floor with a recommendation. 

Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 



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CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Robert i Aye. 

CHAIRMAN ROBERTI: Vote is five to zero; confirmation 
is recommended to the Floor. 

Congratulations . 

SENATOR CRAVEN: I'd like to move James G. Pattillo, 
Deputy Director of the Employment Development Department. 

CHAIRMAN ROBERTI: Senator Craven moves James G. 
Pattillo, Deputy Director of the Employment Development 
Department . 

Is there any discussion or debate on the motion? 
Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti . 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 



37 

CHAIRMAN ROBERTI: The vote is five to zero; 
confirmation is recommended to the Floor. 

Congratulations . 

Before we take up Mr. Sayles, we're going to take a 
five-minute break. 

[Thereupon a brief recess was taken.] 

CHAIRMAN ROBERTI: The Committee will come to order. 

We now have the appointment of Thomas S. Sayles, 
Commissioner of Corporations. 

Mr. Sayles, please come forward and tell us why you 
feel you are qualified to assume this position. 

Unfortunately, I have to leave again, Senator Craven. 
I will be back, but I don't think this is a controversial 
appointment. 

SENATOR CRAVEN: Everybody's in favor of Mr. Sayles. 

MR. SAYLES: Thank you, Senator. 

Senators, my name is Thomas Sayles. By way of 
background, my undergraduate degree is from Stanford University. 
Upon graduation, I was elected to Phi Beta Kappa. My law degree 
is from Harvard Law School. 

Prior to my appointment by the Governor to this 
position in June, I had worked at TRW for nine years. I was — 
I'm a lawyer by training. I have represented the company's 
electronics, energy, and aerospace businesses. 

Prior to joining TRW in 1982, I served as an 
Assistant United States Attorney. I was involved in civil 
litigation there. Prior to that, I was a Deputy Attorney 



38 
General, also involved in civil litigation. 

I think my combination of both private sector and 
public sector experience qualifies me for this job. I find the 
job both enjoyable and challenging. 

I have been doing my utmost to try to improve the 
efficiency of the Department while I've been there. I would 
urge you to support my appointment to this position. 

SENATOR CRAVEN: Any questions of Mr. Sayles? 

Senator Mello. 

SENATOR MELLO: I've move his nomination to the 
jJFloor. 

SENATOR CRAVEN: Very well. 

Anyone in the audience wish to comment? There 
appears to be none . 

The motion is in order. Call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

Three to zero. 

SENATOR CRAVEN: Let's hold the roll open. I'm sure 



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that both Senator Roberti and Senator Petris, since he's a 
Stanford man, too, want to vote for you. 

All right, very well. It's out, as far as that's 
concerned, however, Tom. 

MR. SAYLES: Thank you very much. 
SENATOR CRAVEN: Congratulations. 

[Thereupon this portion of the 
Senate Rules Committee hearing 
was terminated at approximately 
3:30 P.M. ] 

— ooOoo — 



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CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of 
the State of California, do hereby certify: 

That I am a disinterested person herein; 
that the foregoing Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel 
or attorney for any of the parties to said hearing, nor in 
any way interested in the outcome of said hearing. 



hand this 



IN WITNESS WHEREOF, I have hereunto set my 
/3 day of March, 1992. 



!LYN <J. *flZAK 
Shorthand Reporter 




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190-R 

Additional copies of this publication may be purchased for $5.00 per copy plus 
current California sales tax. (Price includes shipping and handling.) 

Senate Publications 
1100 J Street, B-10 
Sacramento, CA 95814 

Make checks payable to SENATE RULES COMMITTEE. 

Please include Senate Publication Number 190-R when ordering. 






HEARING 



SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




DEPOSITORY IT*jv. 

APR 2 8 1992 

^BLIC LIBRARY 



STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

WEDNESDAY, FEBRUARY 26, 1992 
1:50 P.M. 



186-R 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 
ROOM 113 
SACRAMENTO, CALIFORNIA 



WEDNESDAY, FEBRUARY 26, 1992 
1:50 P.M. 



Reported by: 



Evelyn J. Mizak 
Shorthand Reporter 



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APPEARANCES 
MEMBERS PRESENT 
SENATOR DAVID ROBERT I , Chairman 
SENATOR WILLIAM CRAVEN, Vice Chairman 
SENATOR ROBERT BEVERLY 
SENATOR NICHOLAS PETRIS 
SENATOR HENRY MELLO 

STAFF PRESENT 
CLIFF BERG, Executive Officer 
PAT WEBB, Committee Secretary 
RICK ROLLENS, Consultant on Bill Referrals 
NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

JAMES M. CONRAN, Director 
Department of Consumer Affairs 

SENATOR DAN BOATWRIGHT 

BOB HOERGER, Newsletter Publisher 
Engineers Board Review 

WILLIAM GOODE, Attorney at Law 
Former Deputy Attorney General 

RUSSELL S. GOULD, Secretary 
Health and Welfare Agency 

SHERRIE GOLDEN, Legislative Advocate 
California State Employees Association 

CHARLES W. SKOIEN, JR. 

Community Residential Care Association of California 

RALPH BRAVE 

Americans for a Safe Future 

NILROSINO A. LIM, Provider 
Filipino-American Care Providers 



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APPEARANCES (CONTINUED^ 



WILLIAM DOBSON, Former Provider 
Residential Care Facility 

RUTH DOBSON, Former Provider 
Residential Care Facility 

SAM STEVENS, Volunteer Provider 
Boys and Girls Mental Health Centers 

RUTH DOYLE, Provider 
Sutter Valley Group Home 

GARY WILSON, Provider 
LKM, Inc. 

WILLIE HAUSEY, Legislative Advocate 
Various Provider Associations 

JAMES T. JOHNSON, III, President 

Association for Minority Adolescents in Residential Care 

Homes (AMARCH) 

KEN SEATON-MSEMAJI , President 
United Domestic Workers of America 

KENNETH M. KELLER, Chief 

Bureau of Electronic and Appliance Repair 

Department of Consumer Affairs 

JAMES R. SCHONING, Chief 
Bureau of Automotive Repair 
Department of Consumer Affairs 



IV 



INDEX 

Page 
Proceedings 1 

Governor ' s Appointees : 



JAMES M. CONRAN, Director 

Department of Consumer Affairs 1 

Qualifications 1 

Background 3 

Work in DCA 3 

Problems with Department 4 

Boards Acting as Guilds 5 

Intentions 5 

Public Hearings 5 

Holding Boards and Members Accountable 6 

Witnesses in Support; 

SENATOR DAN BOATWRIGHT 7 

Interviewing Each Prospective Candidate 

for DCA Board Memberships 8 

BOB HOERGER, Publisher 

Engineers Board Review Newsletter 9 

WILLIAM GOODE, Retired Attorney- 
Former Deputy Attorney General 10 

Historical Relationship between Directors 

of DCA and Boards 11 

Blaming Predecessor 12 

Importance of SB 961 13 

Questions by SENATOR PETRIS re: 

Nature and Scope of DCA's Problems 14 

Existence of "Mafia" 14 



Crying about Past 15 

Need to Recognize Mistakes of Past 17 

Capacity in Attorney General's Office 17 

Question by SENATOR BEVERLY re: 

Ranking Order of Power Structure 

in State Government 18 

Statement by MR. CONRAN 18 

Questions by SENATOR MELLO re: 

Problems in Funeral Home Business 19 

Pushing Agressiveness in Boards 

Revoking Licenses 20 

Public Membership of Boards 20 

Possibility of More Legislation to 

Give Director Authority to Revoke 

Licenses 22 

Public Hearings in Spring 22 

Additional Comments by MR. GOODE 23 

Recommendation to Read SB 961 23 

Majority of Board Membership Comprised of 

Public Members Except Healing Arts 2 3 

Questions by SENATOR PETRIS re: 

Position on Confirmation 24 

Conclusion by MR. CONRAN 25 

Pledge to Make DCA Proactive 25 
Questions by SENATOR PETRIS re: 

Support from Agency Secretary 26 

Opposition to Former Secretary of Agency 26 

Motion to Confirm 27 

Committee Action 28 



VI 



,JRUSSELL S. GOULD, Secretary 

(Health and Welfare Agency 28 

Qualifications 28 

Career in State Government 29 

Department of Social Services 29 

Department of Finance 29 

State Treasurer's Office 30 

Service on National Association 

of State Budget Officers 31 

Departments in Agency 31 

Guiding Principles of Agency 32 

Moving Programs to More Preventive 

Approach to Government 32 

Breaking Down Barriers to Improve Services 33 

Better Access to Primary Preventive 

Health Care 34 

Promotion of Self Sufficiency 36 

Difficult Choices with Limited Resources 36 

Questions by SENATOR MELLO re: 

Appointment of Director to Department 

of Aging 37 

Uniform Billing System for Medi-Cal 38 

Deadline for Operation of Ward Valley 

Project 39 

Affirmative Action Plan in Deparatment 41 

Provider Access to Appeals Process 42 

Questions by SENATOR PETRIS re: 

Access to Health Care 44 

Long-term Care 44 



Vll 



Insurance Industry 45 

Reduction of Grants in Welfare Reform 47 

Financing of the Children's Initiatives 50 

Federal Matching Funds for Safety Net 

Hospitals 51 

Funding Versus Actual Need 53 

Assurance that Feds Will Pay 53 

Ward Valley Project 54 

Track Record of U.S. Ecology in 

Other States 54 

Analysis of Waste Stream Data 55 

Requests from Congressman Miller 55 

Possibility of Recycling 55 

Testing Below 100-foot Depth 57 

Use of Liners 57 

New Recycling Process Developed by 

Lawrence Berkeley Laboratory 58 

Witnesses in Support: 

SHERRIE GOLDEN, Legislative Advocate 

California State Employees Association 59 

CHARLES W. SKOIEN, JR., Consultant 

Community Residential Care Association of 

California 61 

Witnesses in Opposition: 

RALPH BRAVE 

Americans for a Safe Future 62 

Concern about Ward Valley 62 

Public Safety and Liability 62 

Majority of Waste Would Come from Nuclear 

Power Industry 62 



Vlll 



Department's Refusal to Grant Hearing on 

Details of Project 63 

Lack of Alternatives in Environmental 

Documentation 64 

Appointee's Relationship with Nuclear 

Waste Industry 64 

Questions by SENATOR MELLO re: 

Suggested Solution 66 

Neutralizing Radioactive Waste by 

Recycling 66 

NILROSINO LIM, Provider 

Filipino-American Care Providers of Sacramento 67 

Lack of Due Process 67 

Lack of Consistency in Citing Process 67 

Lack of Support 68 

No Collection Rights for Board and Care 68 

Closing of Facility before Scheduling of 

Appeal Hearing 6 8 

Lack of Correct Direction from Community Care 

Licensing 68 

Questions by SENATOR PETRIS re: 

Grounds for Suspension of Facility 69 

Leading Questions of Investigators 70 

Number of Clients in Facility 71 

Normal Procedure of Department 71 

Location of Facility 71 

WILLIAM and RUTH DOBSON, Former Providers 

Residential Care Home for the Aged 72 

Closure Incident 72 

Police Investigation 73 

Discussion with Fred Miller 73 



IX 



Request to Change Temporary Suspension 
Order Rules 74 

3 

Lack of Notification 74 

Questions by SENATOR PETRIS re: 

Legal Remedy or Appeal 7 6 

Lack of Documentation on Temporary 

Suspension Order 76 

8 Traumatized by Actions of Community 

Care Licensing 7 8 

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Willingness to Help Change Law 78 



Need for Nonbiased Mediation Board 79 

Involvement of Phyllis Eversole of CCL 79 
Questions by SENATOR PETRIS re: 

Attempts to Contact MR. GOULD 80 



Compliance with Section 527 of 

Code of Civil Procedure Would 

Provide Due Process 78 

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16 

SAM STEVENS, Volunteer Provider 
17 Boys and Girls Mental Health Centers 

El Cajon 80 

18 

Necessity to Change Population of Clients 81 
19 

Background of Operation 81 

20 

Involvement of Community Care Licensing 

21 through Anonymous Complaint 82 

22 Crisis during July 4th Weekend 82 

23 CCL ' s Recommendation Not to Renew 

License 82 

24 

Filing of Appeal and Temporary 

25 Suspension Order 82 

26 Ordered to Fire Executive Director 83 

27 Closure of Facility 84 

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Not Allowed to Counsel Staff or 

Children on Closure 85 

Traumatic Situation for Children 85 

Media Involvement 86 

Coercion of Staff by State's Attorney 86 

Grounds of Temporary Suspension Order 87 

Board Put in Undefendable Position 87 

Questions by SENATOR PETRIS re: 

Suggestion on How to Correct 

Policy 88 

Need for Agency's Attitude to Change 89 

12 Statements by SENATOR MELLO re: 

Request for Brief Summary of Previous 

Witnesses' Cases Be Sent to Senator 90 

Possibility of Needed Legislation for 

Corrective Action 90 

Not Intent of Legislation for "Temporary" 

to Become "Permanent" 90 

Questions by SENATOR CRAVEN re: 

Contemplated Changes to Program 92 

Need to Look into Situation 9 3 

Dates for Implementation of Changes 9 3 

Ombudsman/Technical Support Unit 93 

Providers ' Lack of Recourse to Department ' s 

Actions 94 

RUTH DOYLE, Provider 

Residential Care Facility 95 

Met with MR. GOULD 95 

Types of Complaints CCL Receives 96 



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Dropping of 33 out of 36 Allegations 
at Settlement Conference 

Meeting with Fred Miller 

Meeting with MR. GOULD 

Substantiation of Department's Actions 

Questions by SENATOR PETRIS re: 

Independent Investigation by AG's Office 
under Current Process 

Need for Communication 

Response by MS. DOYLE 

Department not Adhering to Regulations 

No Way for Providers to Enforce Laws 

Fear of Retaliation from Department 

Request for Direct Report if Department 
Retaliates for Testifying 

GARY WILSON, Former Provider 
LKM Homes 

Meeting with MR. GOULD 

Department ' s Refusal to Adhere to 
Rules and Regulations on Books 

Taking of Illegal Out of State 
Deposition 

Government Code Sec. 11511 
Green Book 

Use of Media to Close Facilities 
Dragging out Appeals 
Questions by SENATOR CRAVEN re: 

Place of Residence 

Bringing Problems to Attention of 
State Senator 



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Response by MR. GOULD 109 

Establishment of Independent Task 

Force to Review Issues 110 

Verification of Actions Taken 110 

Meeting with Interested Senators to 

Share Findings 110 

Effect of Proposed Changes in Procedures 

to Already Closed Facilities 111 

Request by SENATOR PETRIS re: 

Submit Questions on Nuclear Waste Problems 

to MR. GOULD 112 

Put Over Hearing until Hearing for 

Director of Department of Health Services 113 

Discussion 113 

Decision to Put Over Hearing for Three Weeks 114 

Witness in Support; 

WILLIE HAUSEY, Legislative Advocate 

Numerous Provider Organizations 115 

Need for Provider Rights 115 

JAMES T. JOHNSON, III. President 

Association for Minority Adolescents in 

Residential Care Homes 116 

Need to Restructure Appeals Process 116 

Request that Committee Inquire as to 

Agency's Position on Institutionalization 

Vs. Community-Based Programs 117 

Current Rate Setting System 117 

Request for Meeting with MR. GOULD 117 

Closures Related to Lack of Due Process 

Should Be Allowed to Obtain Licenses 118 

Need for Affirmative Action Program 118 



Xlll 



KEN SEATON-MSEMJI , President 
United Domestic Workers of America 

Former Hostility of Department 

New Accessibility under GOULD'S Leadership 
Questions by SENATOR MELLO re: 

Date of DOBSON Incident 

Date of Incident Described by STEVENS 

Resetting of Hearing for Three Weeks 

KENNETH M. KELLER, Chief 

Bureau of Electronic and Appliance Repair 

Department of Consumer Affairs 

Qualifications 

Background 

Printing Business 

Aims and Goals 

Certification of Repair Technicians 

Service Contracts 

Enforcement of Disclosure Laws 

Motion to Confirm 

Committee Action 

JAMES R. SCHONING, Chief 
Bureau of Autommotive Repair 
Department of Consumer Affairs 

Qualifications 

Legislative Background 
Participation in Coro Foundation 

State Smog Check Program Top Priority in Past 

Number of Disciplinary Actions 

New Automotive Technology Ahead of 
Repair Skills of Technicians 



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Question by CHAIRMAN ROBERTI re: 

Programs to Update Auto Repairmen 131 

Additional Training through 

Federal Grants 132 

Motion to Confirm 132 

Discussion by SENATOR BEVERLY 133 

Committee Action 133 

Termination of Proceedings 133 

Certificate of Reporter 134 



1 

P-R-O-C-E-E-D-I-N-G-S 
— 00O00 — 

CHAIRMAN ROBERTI: We will now take up Governor's 
appointees appearing today. 

Do we have any appointees who have a number of out of 
town witnesses? 

MS. MICHEL: I don't know, Senator. 

CHAIRMAN ROBERTI: We will take them in alphabetical 
order. James M. Conran, Director of the Department of Consumer 
Affairs. 

Mr. Conran, we will ask you what we ask all the 
Governor's appointees, and that is why you feel you're qualified 
to assume this position. 

MR. CONRAN: Good afternoon, Mr. President, Members 
of the Senate Rules Committee. 

I have a brief opening statement I'd like to make 
that I think will cover probably many of the questions that the 
Committee would like to ask me. 

It's a pleasure to appear before you. It's an honor 
to be nominated by the Governor, Agency Secretary, and supported 
by numerous community arid consumer leaders for my appointment as 
Director of the Department of Consumer Affairs. With your 
support and confirmation, we will complete our goal of putting 
the word "consume" proactively back into the Department of 
Consumer Affairs. 

In researching DCA, I came across a remark of a 
predecessor that rings as true today as it did over 60 years 



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ago. In 1929, J.S. Casey clearly and concisely stated the 
imission of the Department. His words: 

"To protect the public health, to 
protect the public against fraud, 
and to generally elevate the 
standards of industry. " 

I have always had a great interest in government, 
jjbut never envisioned myself as part of the process. I come to 
[{government from the private sector with the belief that 
individuals can make a difference. 

We want to make SCA a more effective and efficient 
protector of the public, and we want to make DCA a better place 
to work. 

Serving as Director is an honor and a most 
challenging opportunity. My first and foremost duty has been 
to make DCA and its 2300 employees dedicated consumer advocates 
who are committed to making California a better place to live, 
work, and to raise families. 

The impact of DCA on the lives of Californians is 
tremendous. We affect the public from cradle to grave. DCA 
regulates 180 professions and industries, including: 
accountants, automobile mechanics, smog mechanics, boxers, 
contractors, doctors, embalmers, nurses, veterinarians, 
collection agencies, and cemeteries. Approximately one-third 
of the state's employed population is either licensed directly 
by DCA or works for one of our 2.1 million licensees. 

Governor Wilson and Agency Secretary Dr. Bonnie 



3 

Guiton have given me the essential tools to turn DCA from a 
back-water agency to an organization that will be aggressive 
and proactive in putting the public first. 

We have brought strong management skills to the 
Department. I have over 14 years of corporate experience with 
Pacific Bell, specializing in regulatory, consumer, and public 
policy issues. 

Our appointees have either corporate experience or 
previous experience in executive positions within state or 
federal government. We have replaced 20 of the 22 incumbents 
from the previous Administration in exempt positions. Two- 
thirds of these appointees are women or minorities . We moved 
career managers in other positions at DCA to shake off the 
malaise that had overcome the Department. 

We worked to rebuild trust with critical 
stakeholders in both the government and private sectors. 
Frankly, DCA was not up to the standards that both we and the 
public have a right to expect and demand. Morale was low, and 
there was little, if any, trust or cohesion between 
employees, board members, their officers, the media, or the 
Legislature. 

In the past year, I visited every one of the over 
100 offices under the umbrella of the Department of Consumer 
Affairs at least once. The opportunity to meet and talk with 
most of the employees was extremely valuable to me. I shared 
my vision of DCA with them, asked them for their support and 
their commitment. They shared their experiences, their hopes 



4 

and desires, and collectively, we are in agreement that DCA can 
do much more for the people of California. 

We recognize that Californians live in a highly 
technical, computerized age that contains large bureaucratic 
structures and corporate conglomerates where individual rights 
are often forgotten or ignored. Our job is to assist citizens 
and businesses cope in these uncertain and troubled economic 
times . 

We want to be fair and balanced in our decisions 
and actions. We want to be pro consumer, we want to be pro 
business. Some may think this is idealistic, but I do not. 
Encouraging businesses who are serving the interest of 
consumers is a major focus of our efforts. We will assist and 
partner with these companies who desire to provide better 
services to the public. 

We want to support businesses in providing quality 
goods and services the public needs and wants. We want to 
acknowledge and expand the pool of reputable goods and 
services as we work to eliminate the untrustful — 
untrustworthy, unlawful practitioners and business people. 

Our goal is to protect the public. We want to make 
the marketplace fair, accessible, and truthful in providing the 
public and businesses with maximum free-market options. 

Above all, we want businesses and practitioners to 
know that if they fail and abuse the public, we will be 
aggressive and relentless in our pursuit of them. 

We are currently involved in a rigorous dialogue 



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with the boards the Department regulates. Many have a 
disappointing reputation of protecting the public; some do not 
protect the public at all. 

Some boards have become nothing more than guilds or 
exclusive country clubs, which are either used to keep 
competition out of the marketplace, or serve to protect 
industry from the public. Many boards use their regulatory 
cartels to limit entry into the marketplace, thus keeping 
competition out while keeping cost high. 

We must not lose sight of the only reason why we 
regulate professions and industries. It's to promote fair 
competition and to protect consumers. Government must support 
both reputable performers and consumers from the poor or 
deceitful bad apples. 

DCA will aggressively pursue the path that puts the 
consumer interest before the interest of the guilds. 

Thomas Jefferson once said that citizens should 
tear down and rebuild government every 20 years so it would not 
lose touch with the people. DCA is now 22 years old. 
Therefore, this year the Department will conduct public 
hearings to revisit the Department's purpose and structure. We 
hope to look prospectively to the future and meet the needs, 
the ever changing needs, of the people of California. 

It is our intent to look thoughtfully at DCA in 
order to determine how it can best meet the demands of the 
rapidly changing marketplace and pubic, not just for today, but 
for the future. 



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Boards will be more effective when they focus on 
setting policy, public policy, over self-interest policy. 
Board must set fair standards for entry and competency, and 
they must be the adjudicators, setting firm and consistent 
discipline. The Administration, the Legislature, and the 
public must hold boards and board members accountable for their 
actions or their lack of action. 

The past year has been an extremely busy one for 
the employees of the Department. There is increased and 
renewed energy for our activities by the employees . They have 
a Governor, an Agency Secretary, and a Director who believe 
that DCA must play a vital role in government and in the lives 
of the people of the state. 

Provide me and the team we have in place the 
opportunity to continue what we have begun. We assure you a 
Department that will serve the public and licensees fairly and 
honestly. 

You have been provided with a copy of my beliefs 
and values. I have it here in my hand, and it's been given to 
your staff. It is something that I wrote earlier this year and 
distributed to all the employees who work for me in the 
Department . 

It ■ s important for employees to understand how I 
approach day-to-day decisions, and how we will judge those that 
we work with. We want all of our employees to be consumer 
advocates, and we want them to remind me personally of my 
beliefs and values if they ever feel I have lost sight of why I 



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am Director. 

I respectfully ask you to do the same. After all, 
consumer protection is a team effort. 

In conclusion, there is a quote which reflects 
these troubled times and my own proactive approach to consumer 
protection and management. The quote is by John Paul Jones. 
Captain Jones said: 

"I have no interest in ships that do 
not sail fast, for I plan to sail in 
harm ' s way . " 

I invite DCA employees, board members, Legislators, 
and the public to sail with me in making the Department more 
responsive to California's changing needs. 

These are tough times . There are too many problems 
and too few resources to meet the demands . 

My pledge to you is the same I have given the 
Governor, that Jim Conran will be straightforward, fair, will 
seek solutions to problems with creativity, dedication, energy 
and urgency. 

We are here to help the public. They should be 
able to depend upon DCA to defend their interests and their 
rights, and to encourage businesses to provide them with 
reputable goods and services they deserve. 

Thank you. 

CHAIRMAN ROBERTI: Thank you very much, Mr. Conran. 

Senator Boatwright is here to testify in support. 

SENATOR BOATWRIGHT: Yes, Mr. Chairman and Members. 






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I'm appearing to urge your recommendation of confirmation by 
the Senate. 

I have worked with Mr. Conran for the last year, 
iand during that time, I've seen a very dramatic change in the 
[attitude from the Director, the Director's office. I've 
discussed this with Mr. Conran many times. I've also discussed 
with him specifics. 

I'm convinced, and I'm convinced that he believes 
that the only reason a board exists is to license people they 
feel are competent in a particular field so that the consumer 
is protected rather than the guild that too often in the past 
the boards have represented. I'm absolutely convinced that's 
his goal . 

I had a concern that I discussed with him. He has 
taken the time, and it's rather tedious, I know, to interview 
each prospective applicant who is subject to appointment by the 
Governor to one of the boards to replace the members that are 
there. I wanted to make sure that he was dealing with those in 
a nonpartisan way, that partisanship and politics was not 
entering into that. I specifically discussed this with him. 

I'm convinced that it is being handled in a 
nonpartisan way, looking for the best person to serve on these 
boards . 

So, I'm here today to say that it's been refreshing 
jj to have a person who, as he said to you, the only reason that 
the boards exist should be to protect the consumer. I think 
that's his goal. I think with what we're working on together, 



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we will be able to perhaps in the future consolidate some of 
these boards or eliminate some other boards, make them more 
efficient, and above all, to make sure that that goal of really 
protecting the consumer is the only reason any board exists . 

So, I would urge your recommendation for 
onf irmation. 

CHAIRMAN ROBERTI: Thank you, Senator. 

Is there anyone here to testify in support? Yes, 
please come forward. 

MR. HOERGER: Senator, my name is Bob Hoerger. I 
privately publish the newsletter Engineers Board Review , which 
covers the activities of one of the boards under DCA. In 
connection with that work that I've done for a couple of years, 
I've had quite a bit of contact with some of the divisions in 
DCA: the Division of Investigations, the Legal office, Central 
Testing, and so forth. 

I also ~ as I say, I'm licensed by one of the 
boards as a surveyor. I'm also an attorney and occasionally 
practice public interest law pro bono in connection with these 
boards ' activities . 

I came in contact initially with Director Conran 
early in his term in which I had a perceived problem with an 
action that he took, and the result of that communication has 
brought me here. I decided I should come up here from the Bay 
Area because I thought that he handled the problem extremely 
well . 

It was an issue in which the Department was 



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advocating on behalf of consumers in the telephone caller I.D. 
issue. I perceived a problem because Mr. Conran had previously 
been with the telephone company. All I needed to do was make a 
telephone call and raise this problem. Mr. Conran very 
promptly, openly, and to my complete satisfaction, took care of 
the issue. 

I thought there was an initial greenhorn misstep. 
He took care of it honestly, openly, and in a way that I have 
never seen happen up in the bureaucracy up in Sacramento 
before, and i was very pleased with the change of bureaucratic 
procedures from what I had seen before. 

So for that reason, I think you could not do better 
than to have a man like this in this important position, and 
I'm pleased to support him. 

CHAIRMAN ROBERTI: Thank you very much. 

Yes, please come forward. 

MR. GOODE: Mr. President and Senators, my name is 
William Goode. I'm a semi-retired attorney, which is probably 
the worst kind except for those who are not yet retired. 

I'm also a former Naval officer, and I was raised 
on John Paul Jones . And today I hope that my ship is fast 
because I feel I'm standing in harm's way. 

SENATOR PETRIS: Do you go back that far? 
[Laughter. ] 

MR. GOODE: At the Naval Academy, John Paul Jones 
is there at your crypt [sic]. You go to chapel right over the 
crypt, and he is part of your life. That's true. 



11 

My comments are based on my 25 years ' experience in 
the Department of Justice as a Deputy Attorney General. Most 
of that time was spent in representing the Department of 
Consumer Affairs, the Director, and the various constituent 
boards and bureaus in their legal problems . 

I've seen many directors come and go. I've been 
very familiar with the problems. 

It's been my experience that historically, the 
relationship between the Director and the boards, particularly, 
has been a constant struggle for power, domination. The boards 
consider themselves to be completely independent of any control 
by the Director, and some of the Directors have felt that they 
are dominant, that they have the right to control all of the 
boards. The truth actually is somewhere in between. 

We don't really have that particular problem here. 
Jim Conran is, obviously, a public relations man. His 
background is public relations, and he's damn good at it. He 
has made a number of presentations and interviews granted to 
the newspapers, one in the San Francisco Examiner just a very 
short time ago. 

But running throughout all these newspaper articles 
is one predominant theme, and that is: "I don't know what I'm 
going to do. I've got a tough job. Things are so bad. My 
predecessor left things all screwed up. Morale was bad. The 
boards are belligerent; they won't cooperate. The state 
personnel are incompetent; I can't get them to do what I want 
to do. But I'm going to attack this problem on a high moral 



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plain. " 

I'm not sure what the high moral plain is, because 
I really haven't seen any manifestations. I can only attribute 
that to the fact that different people have different ideas of 
morality. 

It is that concept that concerns me. There are all 
types of leadership. A leader can drive; he can push; he can 
threaten; he can retaliate; he can promise; he can goad; he can 
say "follow me." But one thing that he cannot do and remain 
effective is to harp and cry about how bad things are because 
of what his predecessor did, and to blame his predecessor for 
everything . 

I will give Jim credit. He did inherit a mess. 
The last Administration, the Department of Consumer Affairs was 
simply an abortion, it was a "mafia". And you were either on 
the inner team or off with your head. 

He faced that. Having faced that, he had the 
responsibility from the day that he came aboard, this was his 
job, and he is the one that is responsible. 

And I would like to see this business of blaming 
the prior Director and the prior Administration for all the 
evils, which did exist — and that the responsibility be 
exercised by Jim. 

Now, the Governor's Office appointed some top-level 
people to his senior staff. Jerry Knight, legal, is one of the 
most competent attorneys in the Attorney General's Office when 
I was there. Lance Barnett, very high credentials. So, he's 



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got all the materials. 

Jim is a very intelligent and a very capable man. 
I think that he should be confirmed, but it should not be a 
pattern of back-type confirmation, "Let's strike up the band." 
But it should be a very somber confirmation and say, "This is a 
tough job. You've tried it. You want it. You're qualified. 
You've got it. Now stop the crying; take care of your own 
responsibilities. Get on with the job." 

Let's have less rhetoric and more action. The 
Director actually is the fifth most powerful man in the state. 
When I discussed Senate Bill 961 with Jim several weeks ago, he 
had no knowledge of it. Yet that bill was probably one of the 
most important pieces of legislation affecting the Department 
Ijof Consumer Affairs in 20 years. It gives the Director the 
authority to get into examinations, examination procedures 
where there are alleged irregularities. There are a number of 
examination irregularities, and so far, the action has been 
very, very reluctant. 

But with that comment, I think that Jim Conran has 
the staff, the ability, the determination, and if the crying is 
stopped and the responsibility's accepted for what he did, then 
I think you'll have a damn good Director, a damn good 
Department. If you don't, there are going to be more problems. 

Thank you. 

CHAIRMAN ROBERTI: Thank you very much. 

SENATOR PETRIS: May I ask a question. 

CHAIRMAN ROBERTI: Yes, Senator Petris. 



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SENATOR PETRIS: This is the first time I've ever 
heard that Consumer Affairs was in a horrible mess. 

So we can avoid that similar mess in the future, 
can you briefly tell us the scope of the problem? What was the 
nature of the problem? 

MR. GOODE: The nature of the problem was, you had 
a "mafia". The Department was controlled by a very small 
clique at the top under the Director. The Director couldn't 
care less about running the Department at that time. 

SENATOR PETRIS: You mean the Agency head? 

MR. GOODE: No, the Director of Consumer Affairs. 
He had other interests, so the actual running and the brains 
behind the Department was at a lower echelon. 

SENATOR PETRIS: Are these civil servants you're 
talking about, or — 

MR. GOODE: No, no. 

SENATOR PETRIS: — or appointments? 

MR. GOODE: These are appointees. And they ran the 
thing, and they infiltrated all the boards. People were 
training in the Department under this "mafia", and then they 
went out into the board. And that's how they controlled the 
boards. Many of the boards were under the complete domination 
of this "mafia" . 

SENATOR PETRIS: Did they carry out the public 
policy of the statutes? Is that just a turf fight to see who's 
going to run it, or — 

MR. GOODE: No, sir. 



15 
SENATOR PETRIS: — were they going contrary — 
MR. GOODE: There were numerous irregularities, 
particularly with the procurement of state contracts for 
examinations. There were numerous irregularities, and numerous 
irregularities on the boards themselves. Now -- 

SENATOR PETRIS: Was that on all the boards? 
MR. GOODE: I don't know. I'm not familiar with 
all of them, but the ones that I was familiar with, yes. 

There were the board members, the members were 
associating with the contractors. And it was a fairly bad 
situation. 

Now, one of the things that Jim did, he did say he 
came in with a clean broom and swept everything out. Almost. 
]He left behind two of the key people in the "mafia". And so, 
linitially -- initially there was the continuation of this 
thing, and Jim made some, from an attorney's point of view, he 

made some bad legal decisions at the very beginning. But 

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[eventually there were changes made and those were corrected. 

I don't believe that that type of a situation could 
possibly exist again, because Jim's interests are quite a bit 
different from the prior Administration. And I cannot imagine 
jthat type of a "mafia" — cannot imagine him allowing anyone in 
his organization to go off into this subculture type thing that 
existed before. So, I see no possibility of that happening 
again. 

SENATOR PETRIS: So you're recommending we confirm 
the appointment? 



16 

MR. GOODE: I recommend that his appointment be 
confirmed for the reasons I've stated. He does have the 
ability. He is intelligent. He's experienced. 

But I think it should be pointed out clearly to 
him that this crying about what has gone on in the past, and it 
was bad, but the crying has got to stop. 

SENATOR PETRIS: Who's doing the crying? 

MR. GOODE: Jim. In every newspaper article that 
— every newspaper article that has been published in which he 
has been interviewed, there has been the comment that — in 
fact, he made the comments right here today about how bad the 
boards and bureaus were, and how he couldn't get them to do 
anything. That same theme was carried over to the newspapers. 

Enough is enough, and there has to be a point where 
any leader has to say, "All right, what is past is past. This 
is now my shop. I'm going to run things." And do it. 

He does have the power. As I say, he's the fifth 
most powerful man in the state, Senator Roberti being number 
three . 

CHAIRMAN ROBERTI: Thank you very much. 

MR. GOODE: But it was a very — 

CHAIRMAN ROBERTI: Senator Mello said I was number 



two. 



MR. GOODE: Willie Brown outranks you. 
CHAIRMAN ROBERTI: After Willie Brown. 

[Laughter. ] 
MR. GOODE: But I think that he should be confirmed 



17 
subject to that. 

Actually, whether you do nothing, I'm sure he — 
now that I've sailed into harm's way, I'm sure that he has 
heard what I had to say, and he's going to take it to heart 
whether he likes it or not. And he can't possibly ignore it. 

SENATOR PETRIS: Well, he can't ignore the past 
problems either, can he? In order to be effective, he's got to 
be aware of what happened before. 

MR. GOODE: More than being aware of it, he has to 
be able and willing to do something about it. 

SENATOR PETRIS: You say he's done it. 

MR. GOODE: I had to file — I had to file a 
special petition to get him to act on one thing, and then I had 
to get the Governor's Office to call and direct that he read it 
to correct some of the problems . But that was when he first 
came aboard and he still had this — he still had to deal with 
what was left of the old organization. 

Now that's all gone. All of those people that were 
involved are now gone, and he has his own team in there. And 
they are gradually coming up, and hopefully, all these problems 
are going to be worked out. 

The problems with the boards themselves can only be 
worked out with some command attention, and he does have the 
authority under Senate Bill 961 to take care of those. 

SENATOR PETRIS: What was your capacity in the past 
25 years? 

MR. GOODE: I was a Deputy Attorney General in the 



18 

Civil Division, Office of the Attorney General, the Licensing 
Section. And one of my primarily responsibilities was handling 
cases for the Department of Consumer Affairs as a Department, 
for the Director of Consumer Affairs and — 

SENATOR PETRIS: What kind of cases? Were they 
consumer protection cases? 

MR. GOODE: These were consumer protection cases, 
licensing cases, challenges to authority by the — by members 
of the public, and supporting the Department and the Director. 

SENATOR PETRIS: Thank you very much. 

CHAIRMAN ROBERTI: Senator Beverly. 

SENATOR BEVERLY: I'm curious, Counsel, before you 
leave . 

You mentioned the Director of Consumer Affairs is 
the fifth most important person. The Speaker's second, 
jPresident Pro Tern third. Who's the one in four? 

[Laughter. ] 

MR. GOODE: Obviously, you've got to give the 
Governor some credit, and I have to give my Attorney General 
some credit — 

SENATOR BEVERLY: I see. 

MR. GOODE: — because it isn't realized how much 
power the Director really has. He can enforce any state or 
federal law protecting consumers, and nobody else can do that. 

SENATOR BEVERLY: Thank you. 

MR . GOODE : He ' s got the power . 

MR. CONRAN: I'd like the record to show that I 



19 
didn't say I was in the top five. 

[Laughter. ] 
MR. CONRAN: And please put that in bold letters. 
CHAIRMAN ROBERTI: The head rests lightly on the 



throne. 



[Laughter. ] 
SENATOR MELLO: Mr. Chairman, just a brief 



question. 



CHAIRMAN ROBERTI: Senator Mello. 

SENATOR MELLO: I guess the last witness hadn't 
read the statement made by Mark Twain cautioning people to 
believe everything they read in the newspapers. 

What I'd like to ask you about are, there has been 
from time to time problems in the funeral home business. 

Do you think there are problems there today? Who 
do you plan to help to correct those? 

MR. CONRAN: I do believe there are serious 
problems in those particular industries, as the Senator is well 
aware, but just so the record would show, the Department has 
no day-to-day control over any of the boards that are under the 
DCA umbrella other than to veto regulations that do not serve 
the public interest well. 

Currently, Assemblywoman Speier has a few bills 
that would give more authority to the Department in terms of 
managing enforcement and compliance. We have yet to complete 
our evaluation of those bills, so I'm not in a position to 
speak from any strength. 



20 

But one thing, if there's any trademark that we 
wish to leave by the time we leave our positions is, once 
again, putting in the Department proactive and aggressive 
enforcement of protecting the public. In the area of death, 
there is no opportunity to make matters whole again for a 
family. If a funeral is botched up somehow, if somehow a 
service is harmed, that is something that can never been healed 
again, and I think that's something the industry has to be very 
sensitive to. 

I understand to them it's a business. But for most 
people, that's the most excruciating moment of their lives; 
most painful moment of their lives. And to have the departing 
of a loved one be marred by incompetency, or to be ripped off 
by criminal activity, I think needs to be dealt with in the 
most strictest and aggressive manner possible. 

And one of the things that we are pushing the 
boards to do, which they have not done, is to be aggressive in 
revoking licenses. To do business in California is not a 
right; it's a privilege. And those who abuse the public have 
no right to do business in this state. 

SENATOR MELLO: Is that Board of Funeral Directors 
and Embalmers, do all the members of that board constitute 
people from those categories, or are there other public 
members? 

MR. CONRAN: There are public members. In fact, if 
I'm not mistaken, both the Cemetery Board and the Funeral Home 
Directors and Embalmers are majority public members. 






21 

I think one of the issues, and Senator Boatwright 
spoke to it, is, I have taken a tremendous amount of my time in 
interviewing candidates for the Board, both industry members 
and public members, for any of the boards in the Department, 
because I want to ensure that the types of people on the board 
are going to come there, they're going to do their homework. 
They are there to realize they're there for one reason. It is 
not to embellish their resume; it is not to help their 
professional status. It's to protect the public. And if we 
don't have confidence that those people are going to protect 
the public, then we don't want them on our boards. 

SENATOR MELLO: Are there other boards under your 
Agency that are made up exclusively of their own industry 
representatives? 

MR. CONRAN: All boards have industry members. A 
majority of the boards do have, it's my understanding, public 
members. Quite a few of the boards are majority industry 
members, and the Contractors — no, Contractors are public. 
The Medical Board, I know, is one. The Accountancy Board, I 
believe, is another. But most of the boards have a fair 
sampling of public members. 

The problem is that public members are easily 
swayed by influential arguments by people who are in the 
industry. And you have to be a very strong person, and a very 
courageous person, to stand up against people who — a lay 
person standing up against a doctor and saying, "Your policy is 
wrong. It doesn't make sense for the public good." 



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Most of the arguments these boards get involved in 
are food-chain issues. They're looking at who can gobble more 
of the other person's economic pie. And these are — those are 
not of concern, I feel, to the public. The issue is quality 
care, quality services delivered at a good price, and if 
there's something wrong — if something goes wrong, that 
someone's there to take care of it for them. 

SENATOR MELLO: You stated that you're trying to 
urge this board to revoke more licenses. I guess you're making 
the statement that you yourself and your Department do not 
have authority over that process? 

Do you feel that some additional — I feel that 
your Department ought to have greater responsibility in taking 
action. Are you asking for some legislation that would give 
you that authority that might provide a better way of revoking 
these licenses if they were deemed to be necessary? 

MR. CONRAN: I -- my usual approach is, if you can 
make something that's there work better, try to make it work 
better. And that's been our first approach: trying to make 
the boards live up to their obligations, and holding them 
accountable for their obligations. And if they can't do it, 
then I think it ' s the role of us to do something — something 
else. 

In my prepared remarks, Senator, I did mention that 
in the spring, we will be holding public hearings to get public 
comment as to how we can make the Department better, more 
aggressive. And I think from that, legislation will come. But 



23 
I think it would be premature for me to throw out some issues 
without getting a good public record, inviting consumers and 
industry people to give us their best thinking. 

SENATOR MELLO: Thank you. 

MR. CONRAN: Thank you, sir. 

MR. GOODE: Senator Robert i, may I make one more 
additional comment? 

CHAIRMAN ROBERTI: Yes, one last minute. 

MR. GOODE: This concerns me somewhat. 

Apparently, in spite of his promise to do so, Jim 
might not have read Senate Bill 961, which gives him the power 
and the authority to intervene in any board's proceeding. 
Gives him the power to take over any proceeding from any board. 
So, the power is there. 

So, I recommend that at the first available 
opportunity, that he review Senate Bill 961. 

SENATOR MELLO: Has that been passed? 

MR. GOODE: Yes, sir. It was effective the first 
of January. And I was looking forward to it, because it would 
— it should have eliminated a lot of the problems. But 
apparently, if the Department doesn't know anything about it, 
it isn't going to solve any problems. 

The second point is that all of the board except 
the healing arts have a majority of public members. And to say 
that the public members are cowed by the professionals is just 
simply not true. With a majority, these public members feel 
that their duty is to protect the public from the professionals 



24 
ripping them off. And they come avowed to these boards, mostly- 
avowed to protect the consumers from the professionals and keep 
the professionals in line. And they generally oppose most of 
the actions that are undertaken by the professionals. 

With the healing arts, it's different, and there 
there's a reason to have the professional people in charge, and 
they do. And there the nonprofessionals may be cowed. 

But the majority of the boards, no. The public 
members actually really are in control, and they speak. 

Thank you very much, Senator. 

CHAIRMAN ROBERTI: Senator Petris . 

SENATOR PETRIS: I need to ask you another 
question. 

MR . GOODE : In harm ' s way . 

SENATOR PETRIS: Let me ask you one more time, are 
you in favor of confirmation? 

[Laughter. ] 

MR. GOODE: I am in favor of Jim — 

SENATOR PETRIS: I'm a little bewildered here. You 
are in favor? 

MR. GOODE: I'm in favor because I feel that if you 
make no comment at all, at least Jim has the word. He can't 
very well now just go back and say, "961, don't bother me." 

He's got to read it. So what I've said is going to 
make an impression. He'll probably hate my guts, but that's 
jthe hazard of standing in harm's way; sometimes you get shot. 

SENATOR PETRIS: Thank you. 



25 

CHAIRMAN ROBERTI: Anybody in opposition? 

You may conclude, Mr. Conran, but I don't think you 
really have to. 

MR. CONRAN: I do want to say something for the 
record. 

One, I don't consider myself a whiner, but I am a 
realist. I think people need to know that we have had a 
Department of Consumer Affairs that has not been proactive. 
And it is -- and I am making the pledge to you that I'm going 
to make it a proactive Department, a Department that will serve 
the public good well, will serve it promptly and efficiently. 

And if that's whining, then I'm going to whine a 
lot more because the issue here is to build a consensus in the 
Department . 

I'm a caretaker. I'm here for just a few years, 
and someone will follow in behind me. And I want my 
predecessor -- when my successor comes here and has a 
Department that is managed well, and they can take it to higher 
heights than I hope that I will take this Department. 

We have good employees in the Department of 
Consumer Affairs. They care about what they're doing. They 
are dedicated, and we're giving them the leadership to do so. 

With your support, and your support for the rest of 
the other members of my team that will be coming before you, I 
think that we will give you a Department you can be proud of. 

CHAIRMAN ROBERTI: Thank you. 

Senator Petris. 



26 

SENATOR PETRIS: Are you getting pretty good 
backing from the Agency, the Super-Agency head, for policy? 

MR. CONRAN: Oh, tremendous support from Dr. 
Guiton, tremendous support. She has a real value for what 
consumerism means, and it's been an important part of her life. 
And she's both — not only provides her own strong leadership, 
jbut tremendous inspiration and encouragement. So, we have a 
very positive working relationship. 

SENATOR PETRIS: I've known her for sometime, and 
that's about what I would expect. I made the motion for her 
confirmation. 

I'm not surprised about what you say about previous 
olicy. I strongly opposed her predecessor, whose entire 
usiness career had been devoted to opposing the whole concept 
bf consumer protection in our statutes. And the Governor put 
her in charge of it. And I told her at the time in this room 
and on the Floor, it's not fair for a Governor to put somebody 
in that position, someone who has devoted a whole lifetime, 
professional career, trying to destroy an Agency, and then be 
put in charge of it. To ask her to do the mental gymnastics 
that are necessary to change her whole philosophy is just 
totally unrealistic and impractical. 

I can see you're coming from a totally different 
direction, and I wish you well in turning the whole thing 
around. 

When she first went in there, the Consumer 
Information Bulletins just completely disappeared. I had 



27 

people go into various shops of the various consumer agencies 
that had previously been proactive, and they didn't even have 
little pamphlets anymore, advising the consumer as to the 
nature of the work of a particular agency, and how they could 
be of help to the public. 

Hopefully, well, you carry out what you're telling 
us, I think it's going to be a substantially different 
operation. 

Thank you. 

MR. CONRAN: Thank you. 

SENATOR BEVERLY: Move the Committee recommend 
confirmation. 

CHAIRMAN ROBERTI: Senator Beverly moves 
confirmation be recommended to the Floor. 

Secretary, call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. 

Senator Craven. Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 



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CHAIRMAN ROBERTI: The vote is four to zero; 
Confirmation is recommended to the Floor. 

Congratulations . 

MR. CONRAN: Thank you very much. 

CHAIRMAN ROBERTI: Russell S. Gould, Secretary of 
Health and Welfare Agency. 

Mr. Gould, we'll ask you what we ask all the 
Governor's appointees, and you're in an especially high 
position in the Administration, and that is why you feel that 
you are qualified to assume this position? 

MR. GOULD: Very good. 

Mr. Chairman, Members, thanks for the opportunity 
jto appear before you to express my qualifications for the 
position. 

I'd like to start out by first introducing my wife, 
Beth, who is with me today. I have two sons, Patrick who is 
five, and Kevin who is eight, who are not here. 

CHAIRMAN ROBERTI: You're very welcome to have 
Mrs. Gould with us. 

MR. GOULD: Thank you. 

I wanted to mention them first because I want to 
let you know that they are and will continue to be my first 
priority. 

In terms of my personal background and my readiness 
for this position, I'd like to go into a brief history. 

I was born and raised in Sacramento, clearly a 
California native. My father was a second generation plumber, 



29 

and after quickly assessing my mechanical skills, encouraged me 
to pursue an education and complete my college education. 

I was fortunate enough to go to the University of 
California at Berkeley and graduated there. 

Upon graduating from the University, I returned to 
Sacramento and pursued a career in state government. My career 
in state government started out both in terms of doing budget 
analysis as well as personnel management. I got involved in 
labor relations, training in a variety of services associated 
with state government. 

During that period of time, I had an opportunity to 
work in the Department of Social Services for about four years, 
and I got an understanding of some of the very difficult issues 
that they face in terms of trying to provide services to the 
diverse population of California. 

In 1983, I went to the Department of Finance and 
had an opportunity to serve in a variety of roles there. I 
moved up through the Assistant Director position until I became 
Chief Deputy Director of the Department of Finance. During 
that period of time, there were two major areas which I focused 
on. One was labor relations, where I had an opportunity to 
work with labor unions throughout the state in trying to solve 
labor disputes and try to work out a constructive relationship 
for both compensation and in terms of the way benefits were 
provided to them. 

In addition, I also had responsibility for local 
government issues. And I think it was local government affairs 



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•that I really gained a great deal of appreciation for some of 
jithe issues within Health and Welfare. I think it's very clear 
When you look at our county structure that they are the entity 
that is our arm in providing many services, whether social 
services, or through health services. We work very closely 
with the counties in delivery of those services, and I became 
very acquainted in trying to solve problems associated in those 
areas . 

After the Department of Finance, I took an 
opportunity to become the Assistant State Treasurer. In 1990, 
I moved over and worked for Tom Hayes. I was responsible for 
bond sales, and I established the first College Saver Program 

;i 

jjfor the State of California to encourage people to save so that 
their children could have opportunities for higher education. 

I think for both Tom Hayes and I , we had a much 
^shorter career at the State Treasurer's Office than we 
{envisioned, but it was an interesting opportunity. 

From that point, I got an opportunity presented to 
me by Governor Wilson, who was then elect, who asked me to 
assist him on his transition team in putting together a budget 
plan. And as you know, last year's budget circumstances were 
as difficult as the state has ever faced, unfortunately only to 
be challenged by this year, and some of the challenges we will 
face in the next couple of months . 

But I was pleased to take that opportunity because 
I thought there was something that I could contribute, and I 
wanted to se some tremendous changes in terms of where we head. 



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It was very clear that Governor Wilson had a sense of where he 
wanted to lead this state. 

I did have an opportunity during this period of 
financial management before I went to the Health and Welfare 
Agency to serve as a representative of the State of California 
on the National Association of State Budget Officers. I 
represented the state and participated on their Executive 
Committee for three years. During that period of time, I 
chaired their Health, Social Services and Education Committee. 

I got an appreciation for some of the national 
issues we were involved in in trying to bring better health 
care, social services, long-term care, and other very important 
social issues as we tried to solve them, both on a national 
perspective and how they moved down to the state and local 
level as we tried to make differences for all citizens 
throughout the nation, but in particular to California. There 
was a specific task force on long-term care which I 
participated in and got a full appreciation for the dilemmas we 
face as our society ages, and the tremendous cost challenges 
that we face for those families as we try to support both the 
health care costs and the various needs of aging Americans . 

Moving to the Health and Welfare Agency was an 
opportunity provided to me in April of last year, and it was 
one that I relished. The diversity of the issues and the 
responsibilities are obviously very complex. When you look at 
the departments in the Health and Welfare Agency, there are 
eleven, and you're probably familiar with them, but let me 



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recite them very quickly. We're talking about the Department 
of Health Services, Social Services, Rehabilitation, Mental 
Health, Developmental Services, Employment Development, Aging, 
Alcohol and Drug Programs, Statewide Health Planning, Emergency 
Medical Services, and the Health and Welfare Data Center. 

There are over 35,000 employees in the Health and 
Welfare Agency, and a budget of over $28 billion. 

In looking at this operation, I've tried to 
establish an approach, and in doing so, I've established some 
guidelines that I believe are consistent with the Governor's 
philosophy on how to approach the management of the Health and 
Welfare Agency, because I think all of us recognize how 
important its services are to so many Calif ornians . 

In terms of these guiding principles, first, I 
think the first one is to move our programs to a more 
preventive approach to government. And I think we illustrated 
that last year as we were successful in achieving successes 
with you on a number of areas which I think are heading in the 
right direction. When we look at our Medi-Cal program, we 
started moving towards a managed care approach to delivery of 
medical services, as opposed to relying on a fee for service 
approach; trying to get it in early and provide primary 
preventive care for individuals as opposed to waiting until 
they became seriously ill, and in many cases, unfortunately, 
arriving in an emergency room. 

We also made substantial investments in family 
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to try to encourage people to act responsibly, as well as to, 
for very young women, understand that there were other options 
to them. They shouldn't feel the pressure to move ahead in 
terms of sexual activity until they're ready. We nearly 
doubled the funding there, recognizing that that's an important 
contribution to make. 

Clearly, in terms of teenage pregnancy, we 
augmented adolescent and family life programs and also did teen 
outreach programs in order to try to assist young girls. 

We also expanded residential treatment services. 
There was $23 million added last year to the budget for 
substance abusing pregnant women, trying to put them in a 
position where they could escape from an environment which had 
led them to drug dependency and, with their children, move into 
a situation where they could, hopefully, break out of the cycle 
they had been in and move towards a better future for 
themselves and their children. 

The second principle has to do with breaking down 
barriers to improve services . I think we tried to approach 
that in a wide variety of ways. The program realignment 
legislation of last year, which we arranged with counties in 
order to move both service responsibilities as well as 
resources, I think, was in the right direction. And a 
companion to that was the Family Preservation Act, where we're 
allowing counties to use some of their foster care dollars for 
earlier intervention with children, whether it's through drug 
abuse counseling, whether it's through mental health 






34 

counseling; efforts to try to reach that young child so they 
don't start down the path of being in a foster care home, and 
to try to improve the stability of that home. 

Similarly, we are engaged this year in a variety of 
efforts. There is a Proposition 99 work group which is going 
to try to integrate and coordinate maternal and child health 
programs. We're involved in that endeavor right now, and we 
think that's important. 

We just inaugurated just the other day the 
Farmworker Services Coordinating Council, trying to look at 
services provided to farmworkers in this state, recognizing 
that right now we do not have coordinated services. So, we 
have great participation from a variety of agencies throughout 
the state, as well as local participation, so that we can 
better coordinate services to farmworkers in this state. 

And finally, the Children Summits, which are going 
on throughout the state right now, trying to bring state and 
local officials together, including school districts, to look 
at how to integrate services for children in a more 
comprehensive way. We need to be very smart on how we deliver 
services given the tremendous pressures we are under from a 
financial standpoint. 

Another principle is to provide better access to 
primary preventive health care. I think that was illustrated 
in legislation which was achieved last year. The AIM program, 
Access for Infants and Mothers, was used to increase prenatal 
and well baby care for women of low incomes, so that we do get 



35 

better results in terms of having healthier babies that are 
born and children that have a good chance for their future. 

We have a companion to that this year which we have 
put into the budget, a program called Checkup. And that 
program basically tries to reach pre-schoolers, up to age six, 
and to provide them primary preventive care. And this would, 
again, be focused at low-income kids to give them an 
opportunity to get the kind of primary preventive care — 
everything from eye wear to dentistry, to clinical services — 
so they can have a healthier start. 

In addition, we have added additional resources, or 

^propose to, for the Song-Brown program, which is family 

r 

[physicians, in order to increase the access for care through 
family physicians in rural cities — in rural areas as well as 
in inner cities. And we think that will be effective in 
reaching under-served groups, including those with AIDS, 
refugees, and others that are currently under-served. 

We have also proposed additional resources for the 
Health Career Opportunity Program. We've added $2 million to 
the budget this year, trying to encourage minorities to look 
into health care professions, the whole range of health care 
professions, so that they can provide better care. The 
experience has been that we will get better service then within 
the community, and clearly that's something we want to do in 
jorder to make sure that we have quality care for all 
individuals . 

The last thing, and I'm pleased to be here today to 



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mention this, the legislation last year, SB 855, which 
attempted to aggressively pursue additional federal dollars for 
t»ur safety net hospitals throughout the state by allowing them 
to match federal dollars under the Medicaid Program at the 
federal level. That — we just got word back today from the 
federal authorities indicating that our state plan will be 
approved, which means $800 million to safety net hospitals 
[throughout California. So, we're pleased we were able to 
achieve that. I think it's going to be important to bolstering 
(the safety net system and to improving the quality of care for 
Californians . 

The last principle I'd like to mention is one which 
We're going to try to promote self sufficiency in relation to 
individuals' capabilities. Clearly, as we look at welfare 

eform, and the whole range of issues involved in the welfare 
system in this state, we're going to try to encourage personal 
responsibility and emphasize the partnership that the states 
have with individuals in order to make that public support 
system work. 

Also in areas such as Developmental Services, 
Rehabilitation, Mental Health, I think the funding that we have 
continued there shows our commitment to promote and assist 
people in reach their full potential. And I think we have to 
continue that perspective. 

In closing, it's clear that we have to make 
incredibly difficult choices this year as we did last year. 
The resources have declined dramatically, and the choices 



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within the Health and Welfare areas are becoming more and more 
difficult. 

I think it's also something that I recognize, that 
these choices are central to our character, and they're central 
to our compassion as we look at individuals within our society. 

We must work collectively, be smart in the use of 
Our resources and talents to achieve the best outcomes for 
Children and adults who need services from our area. 

I appreciate the leadership that the Legislature 
has shown in the past, and we've had many successes in trying 

to improve services . And I look forward to working with you in 

I 

the future as we try to solve the very difficult challenges 

that we have before us. 

I believe that the fiscal and program policy 

I 

background I have will be important as we mutually explore 

every option available in order to make sure that essential 

public services are maintained. 

I'd be pleased to answer any questions you might 
have. 

CHAIRMAN ROBERTI: Thank you, Mr. Gould. 

Any questions? Senator Mello. 

SENATOR MELLO: I had a chance to meet with him and 
work with him during the past ten months or so. I've been very 
impressed with his operation there. 

One of the concerns I expressed to him is about the 
Director of the Department of Aging has not been chosen for 
some 14 months, and that's creating a lot of problems with 



38 
lacking someone there who's really in charge of the Department. 

You may wish to comment further on what you think 
the chances are for getting someone in that position very soon. 

MR. GOULD: Well, Senator, I share your interest in 
filling that position as quickly as possible. I'm working 
closely with the Governor's Office as we review applicants, and 
I think we have some very qualified candidates. I hope to be 
able to join with the Governor in announcing the Director of 
the Department of Aging very quickly. 

My concern is that the aging community, as they see 
ko Director being appointed there, they might interpret that as 
a lack of interest in the area, and that is certainly not the 
case. I hope we have demonstrated, as we've worked together, 
our interests in that area, and we want to move very quickly 
and complete that appointment . 

SENATOR MELLO: Thank you. 

The other thing is, we talked briefly also about 
Medi-Cal, and I'm happy to hear you're talking about revamping 
the whole system to get into a managed care program. But I 
showed you some of the comparable billings that are made by 
providers . 

I get more complaints from people, the providers, 
who have a hard time getting their claims settled, you know, 
through your Department. And that is one category that really 
has to be changed, the uniform billing system, or something 
that would — or even get into electronic billing like they 
have up in Canada, where they do it by computer modem and have 



39 
a direct deposit system. 

MR. GOULD: Senator, your point's well taken, and 
the illustrations you showed me, I think, were indicative of 
the kind of problem we have. 

We are exploring the question of uniform billing 
and other ways to achieve savings and just to reduce the 
paperwork that goes on. So, I think we need to be very smart 
about how we do that . 

There ' s no sense in having a very cumbersome system 
that changes provider to provider, so I think we need to work 
in that area. 

SENATOR MELLO: A couple of my colleagues are not 
here, but Senator Alquist asked me that I ask you about the 
Ward Valley low level radioactive waste disposal facility. He 
wrote a letter to the Governor asking that it be made 
operational by January 1, 1993 deadline. 

I guess you're going to play a major role in 
getting that operational . Do you wish to comment on what you 
think the chances are? 

MR. GOULD: Well, we are looking very carefully at 
the issue of Ward Valley. Low level radioactive waste is 
primarily medical waste. It's something that has had a long 
history. 

I think the legislation initially in California 
that discussed Ward Valley started in 1980. Senator Alquist, 
in 1983, carried legislation that talked about siting 
processes . 



40 

We are looking very carefully at that issue. We 
have had a great many public hearings to get testimony. We're 
looking at that information because I think everyone looks at 
this issue and wants to make sure that California has moved 
responsibly yet cautiously in terms of implementing it. 

So, we are looking at it. We're assessing the 
issues of liability. There's issues of the construction of the 
site itself, making sure that all aspects of moving forward are 
handled well . 

So, we are paying a great deal of attention to it, 
and we will be moving forward once we've gotten comfortable 
that all issues have been resolved. 

SENATOR MELLO: Will that be in place by January 1, 
I believe, of '93? 

MR. GOULD: That's — I wouldn't want to commit. 
We're certainly looking at that. I don't know if we're going 
to be able to meet that, but we're looking at that. 

SENATOR MELLO: Is that your target date? 

MR. GOULD: That's a target date, and it's a very 
important one. The issue has been complicated in that there is 
a lawsuit currently at the U.S. Supreme Court level that is 
looking at the federal law that really started the whole 
process in terms of siting requirements for low level 
radioactive sites throughout the nation. So, we're assessing 
the implications of that lawsuit because that just recently 
developed, and that's at the U.S. Supreme Court level. 

SENATOR MELLO: Another question from another 



41 
colleague inquires about whether the Department has a 
county-wide affirmative action plan for the inclusion of women 
and under-represented minority males? 

MR. GOULD: In the — I'm sorry, Senator? 

SENATOR MELLO: Do you have an affirmative action 
plan throughout your Department — 

MR. GOULD: Absolutely. In looking at affirmative 
action, we made it very clear to the Directors from the start 
that we wanted them to move towards a balanced workforce, and 
that's been something that has been consistent. 

Over the past year, through the budget reductions, 
unfortunately, the Health and Welfare Agency has lost many 
employees. But as a net result, actually the affirmative 
action profile of the Agency itself has improved. And I think 
that you see that both black employees as well as Hispanic 
employees have increased as a percentage of the overall 
workforce within the Health and Welfare Agency. 

SENATOR MELLO: Are you up to parity now with the 
percentages of each category? 

MR. GOULD: No, Senator, we're not. 

Currently — I'll get the specific figures for you. 
In terms of Hispanics, we have moved from 15.2 percent to 15.6 
percent; and in terms of black employees, from 12.7 to 13.1, so 
we are in terms of black employees. We are still below parity 
in terms of Hispanic employees . And as we move towards the new 
Census figures, clearly we're going to have to have additional 
efforts in order to balance that. 



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In terms of Asian employees, we do -- we are above 
labor force parity at 6.1 percent, and for disabled we're right 
t labor force parity. 

SENATOR MELLO: What about the level at the 
management-type positions? 

MR. GOULD: Yes. We have again, through the 
reductions, we have also lost a great many career executive 
assignment positions, so we've reduced those. About 22 we have 
lost this year. 

But again, we have made an increase in terms of 
black management at the career executive assignment level. 
We've moved from 10.1 percent to 12.8 percent, with labor force 
parity being 6.6 percent. And for Hispanics, we have stayed 
basically the same. We're 13.5 percent, so there's room for 
progress in that area. 

SENATOR MELLO: And the last point raised is 
iiregarding appeals. It's indicated that the appeals process 
should be restructured to make it accessible to providers. I 
guess that's where there has been licenses revoked, and I don't 
quite understand the question, perhaps, but I'm sure you do. 

Within your Department, there must be — is there 
an appeal process that providers can look for to review their 
revoked licenses? 

MR. GOULD: Yes, sir, there is. 

One of the things in the Community Care Licensing 
area, it ' s a very difficult area. We license over 88,000 
facilities . 



43 

We have made a number of major changes to the way 
we're doing licensing activities in this state, and we do 
believe it'll be more responsive to providers if they have 
concern regarding any action or any action taken against that 
facility. We are also letting them be more responsive of any 
changes so they can be responsive to that. So, we've opened up 
the process. 

We're also going to try to intervene earlier within 
facilities that are having problems to try to provide them with 
support and counseling so they can fix those problems without 
looking at it from a negative, penalty standpoint, but more to 
try to work with the providers so they can be successful. 
Because we have so many good providers who are trying to 
provide adequate care for children in particular throughout 
this state, so we do have improvements in the process. 

SENATOR MELLO: Thank you very much. 

CHAIRMAN ROBERTI: Senator Petris . 

SENATOR PETRIS: I have two or three subjects now, 
and then later we'll get back to some others after there's 
testimony. 

I have to say I'm also impressed with Mr. Gould's 
approach to this job. I've been on some panels with him 
regarding health care, for example, and I like his style and 
his approach. 

The question that I have is, you work under 
directions from the boss, and he lays down the policy that 
carries out our policy. There's some questions and concerns 



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have about that. 

First is health care. As you know, as we've sat 
together in some of these panels, there are close to 6 million 
people in California without any health care coverage, and 87 
percent of them are full-time employees. They work, but their 
employers just can't afford to provide insurance for them. 

The Governor has had some incremental 
recommendations here and there. I haven't heard any clear 
expression of a comprehensive program that will take care of 
that so that we have health care access for everybody in the 
state, and that we have long-term care. You mentioned you've 
been working on long- term care . 

I'd appreciate your comments on both of those. 
What, if any, program is being recommended for long-term care 
in view of the fact that only about one percent of the private 
policies provide any? And the second one would be on overall 
health access. 

MR. GOULD: Let me try the long-term care issue 
first. 

One of the things we're going to continue to work 
on is the question of private insurance. We've got a Robert 
Wood Johnson grant to work with California specifically in 
terms of trying to design insurance models that can work in 
concert with the Medicare structure, so that we don't have to 
impoverish people in order for them to gain access to 
appropriate health care. That there can be, kind of in that 
intermediate stage, where people can use private health care. 



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I think you ■ re exactly right in terms of its 
utilization in the past. It has not been successful, putting 
^people in a position where they really do have to spend down so 
dramatically in order to get adequate health care. 

Given this grant, we're going to work aggressively 
in terms of trying with the insurance industry and with 
providers and consumers to look at methods in which we could 
hopefully construct a better insurance model to try to bridge 
that gap, because it is an area that I think we have to 
jrecognize. We have an aging population that's going to deserve 
essential services, so we have to look at trying to bridge that 
area. And that's going, to be a primary focus area for us. 

SENATOR PETRIS: Have you seen anything encouraging 
yet out of the insurance industry? 

MR. GOULD: Well, it's too early to say I'm 

i 

encouraged by it. I think they are interested. I think they 
recognize that it's an area that needs to be served, and that 
something has to be done. 

And we feel that this is a way we can work within 
the existing system to have a success, because in the absence 
of that, we're going to have to look at different models and 
approaches to provide better services . 

So, I'm encouraged that we can work with the 
insurance industry. 

SENATOR PETRIS: Well, I hope you can work 
something out. It just seems to me, having studied this for 
sometime -- and I don't want to go into a debate on this here 



46 
and now — but I'm not so sure that's the right mechanism. 

There ' re good people in the insurance industry, but 
the problem is such that it forces good people to do some 
awfully bad things, and we all get complaints about it. The 
better known providers, including Blue Cross and Blue Shield, 
we have complaints all the time. They just pull the cord on 
people, yank coverage at the critical time. And this God-awful 
pre-existing condition is still out there. The people who 
really need the medical care are automatically eliminated by 
not even being given a policy. Once they get in, they spend an 
awful lot of time searching for loopholes to exclude the 
coverage, and thereby save the company money. 

Is that because they're a bunch of evil people? 
No. They follow their cost accountants, and the cost 
accountants say, "Hey, if you don't chop here, and here, and 
there, you're going to go broke." 

That's why I raise the fundamental question, and 
I'm not asking you to answer it here. But the fundamental 
question to me is, is that the right mechanism? Is that the 
right institution that we should entrust the billions of 
dollars that are spent for health care, to bring that money 
back to the people who pay it in order to get proper coverage? 

And the people you mentioned are not even in the 
worst shape. They're the second group. The first group has no 
coverage at all; the second group is under-insured. They just 
— these are businessmen. They think they have coverage, but 
they find they have to spend down. I think you described that 



47 
problem very accurately. 

Let me go on to welfare reform. Part of it's in 
the budget this year, and part of it's in the initiative that 
the Governor has proposed. I don't know whether you worked 
with him on that; I supposed you had a certain amount of input. 

I'm troubled by the drive to reduce the grant and 
call it reform. It suggests that everybody on that grant 
doesn't belong there or is getting too much money and ought to 
be reduced. 

Now, what is the current grant for a women with one 
child on welfare? Do you remember that number? Is it 680 or 
690? 

MR. GOULD: Usually what people talk about is a 
family of three, being $663, which is a woman with two 
children. 

SENATOR PETRIS: All right, and if the proposed 
cuts are put into effect, what would the amount of the grant 
be? 

MR. GOULD: I believe the first stage would be — 
for the first six months, that grant would move down to $597 a 
month. And basically, that — it's kind of an across the 
board, all grants would be reduced by 10 percent. 

SENATOR PETRIS: I had somebody do some checking 
today for rentals in Oakland, where I live, and in Sacramento. 

Now, in Oakland, for one bedroom, the cost ranges 
from $425 to $525, and they can't get into public housing 
because the list is so long they have to wait and wait. For 



48 

two bedrooms, which I assume you'd need for a woman with two 
children, the range is from $600 to $650 a month. 

Now, what's a woman supposed to do if that's the 
condition in one of the major metropolitan centers? What's she 
supposed to do for shoes, clothing? Food stamps, I guess, they 
can get to help with the food, but there's an awful lot of 
other things that are needed. 

What does the Governor have in mind to tell these 
women with two children — we won't even go into three and four 
children, but two children — what's she going to do? Go out 
and get a job as a high tech. expert in Silicon Valley? What's 
she supposed to do? 

MR. GOULD: Senator, your question is a good one, 
and I think when we've look at the system in California, what 
was structured over time is a circumstance in which there is 
basically no regard for people assisting through work in 
support of their family. 

The structure of the welfare system in California 
currently provides that if you earn income, basically it's 
deducted from your grant. I don't believe we've created an 
incentive for people to assist in their family's support. 

SENATOR PETRIS: Well, we had that for awhile. We 
had the working poor. They were allowed to be on welfare, and 
they were encouraged to go out and get a job and earn up to a 
certain amount. 

Ronald Reagan wiped that out . He fought it as 
Governor, and he destroyed it as President. And that still 



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seems to be the prevailing view. We haven't been able to make 
enough of a change. 

Are you telling me that the Administration is 
contemplating something along those lines to change it? 

MR. GOULD: Exactly. In fact, through legislation 
which came through last year and the Governor signed, we're 
going to try and re-institute a situation where additional 
earned income can be retained. Basically not to penalize a 
person for trying to assist in the support of their family. 

Actually, through our proposal, individuals who are 
able to go out and get part-time work will be able to not only 
cover the cost of the reduction and to get back that additional 
earned income and be able to keep it, but actually to go above 
what the current law allows in terms of existing retained 
income. So you'll actually have more disposable income. 

What we're trying to do is to encourage, and in 
many cases this will be part-time work. It may be something 
like day care; it may be providing in-home supportive services 
to people who are disabled or the aged, so that they can assist 
in the support of their family. 

What we're trying to do is to bring back that, 
because I think developing job skills, creating that role model 
within the family is a positive thing. 

But our current structure in California has really 
taken away the benefit of people working, and I think we find 
less than 8 percent of people on welfare currently report any 
earned income. We'd like to turn that around and encourage 



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them to aid in the support of the family. We think that's a 
better model for the future. 

SENATOR PETRIS: Are there bills pending now on 
hat? 

MR. GOULD: Yes, sir. 

SENATOR PETRIS: That's very good news. 

Another area is the children's initiatives, which I 
think have some great merit to them. But here again, I'm 
nervous about the financing. Money is taken away from other 
vital needs to pay for that, and again we're put in a position 
of choosing between welfare grants and schools. 

It seems to me that both of those are absolutely 
necessary. Prop. 99 money is being diverted, for example, from 
the original purpose to another very good purpose, but it 
reduces the amount available for the original mission that was 
approved by the people. 

Could you comment on that? It's a derailing of 
funds from one. Robbing Peter to pay Paul, I guess is what I'm 
trying to say, when both Peter and Paul need the money. 

MR. GOULD: Senator, I wish we had far more 
resources. The kind of recession that California has been in, 
and what that's done in terms of state taxes, in terms of the 
diminishing resources we have to fund essential programs, makes 
both of our jobs far more complicated and very difficult 
choices . 

I look at some of the choices that we have to make, 
and they seriously concern me in terms of what it's going to 



51 
mean. 

But at the same time, we have to be -- recognize 
the dilemma and try to have to think through what are the best 
choices for the future and for the children that, as you 
mentioned, we're making hard choices for. 

As I look at some of the revenue estimates that 
have most recently come out of the Commission on State Finance, 
which is not part of the Administration, painting even a 
bleaker picture than the Governor assessed in terms of where 
the recession was, and how the economics were going to be, 
there's no encouragement there either. 

SENATOR PETRIS: Their figures are probably more 
realistic. 

The problems we ' re having are aggravated by the 
fact that the revenue projections were a little too optimistic. 
The need projections were a little too low, so we had a double 
whammy there, and that's why we're fighting over meager 
dollars . 

Could you tell me a little bit more about the 
safety net for hospitals, 800 million from the federal 
government? I think that's terrific. 

What does that mean? 

MR. GOULD: Well, basically what we've structured 
is a program where individual disproportionate providers, 
meaning providers what are providing care to the lowest income, 
can apply for — put their money into a pool. Basically 
they're assessed a fee that comes into the state. We match 



52 
that money with federal resources, so we — 

SENATOR PETRIS: Who pays the fee? 

MR. GOULD: It comes from these hospitals, the 
disproportionate provider public hospitals. Some of them are 
county hospitals; others would be with the university system. 

Those resources come into the state. We include 
those within our state Medi-Cal plan. We tell the federal 
government that we have additional resources from the local 
level that we need to match, where the federal government will 
put up its half. The federal government puts up $800 million, 
jand then we distribute that money out to all disproportionate 
provider hospitals. That includes children's hospitals and 
others that are not initially assessed because they're not 
governmental entities. 

This is really going back to the old Medi-Cal 
models where we actually had local participation in the 
program. And so, we're really going back to a share of costs 
with local jurisdictions in the Medi-Cal program. 

And I'm pleased that, as this was an issue that was 
brought before Congress because it is increasing dramatically, 
obviously, the cost on the federal side, the California 
approach and the fact that we are putting the money back into 
the disproportionate hospitals was really used as kind of the 
model through Congress as they illustrated how states can use 
the money appropriately. If we are going to get additional 
federal resources to supplement safety net hospitals, let's 
make sure they use it for that, and that it's not just merely 



53 
captured and put into the General Fund. 

So, we've been consistent in terms of how we've 
approached it in support of those hospitals. And I think it's 
sorely needed, because the safety net structure really needs 
it. 

SENATOR PETRIS: How does the 800 million compare 
with the actual need? I imagine the amount recommended by the 
hospitals is a lot higher than that. What's the upper number? 

MR. GOULD: I don't know that I could even give you 
a figure. Obviously, there's a great deal of charity care and 
other services being provided in the hospital structure 
throughout California, but this is a substantial shot in the 
arm in terms of providing support. 

SENATOR PETRIS: Is there some way we can find out? 

MR. GOULD: Absolutely. I'll be glad to give you a 
sense of that. 

SENATOR PETRIS: The 800 million is an awful lot of 
money, but if the need is 6 billion, it's not quite as 
impressive or dramatic. 

The other question I have is, what assurance do we 
have that the feds are going to pay the bill this time? We're 
still waiting for them to honor their commitments in a few 
other areas. Is this part of a steady cash flow, or is this a 
new one we're going to have to fight to get? 

MR. GOULD: Well, I believe we've got a commitment 
that will hold. It's something that we spent a great deal of 
time going back to Washington, talking to Members about. We 

; 



54 

had great cooperation from counties as they tried to pursue 
this with us, Los Angeles County in particular. 

And I believe that we will be successful in keeping 
the federal government commitment on this one. 

But I share your concern. We always want to make 
sure we've got the check in hand. 

SENATOR PETRIS: I'd like to go over into another 
area having to do with the ever-present and growing problem of 
radioactive waste. 

There have been some letters directed to you from a 
couple of Members of Congress and others, inquiring about the 
designated dump. Where is it, down in Needles? 

MR. GOULD: About 15 miles outside, yes. 

SENATOR PETRIS: Nearby. 

MR. GOULD: Ward Valley. 

SENATOR PETRIS: And the awarding of a contract to 
U.S. Ecology, and there are certain questions that have been 
raised there that haven't been answered. Maybe I can repeat 
the questions. 

MR. GOULD: Okay. 

SENATOR PETRIS: The first one was that the track 
record of U.S. Ecology in two other states seems to have been 
tainted with a great deal of suspicion as to whether they can 
carry through the contract. They have their defense that says, 
well, it was the state's fault in each case, and I can 
understand that. 

But it makes people kind of uneasy to have this 



3 

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it 

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: 
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; • 



tt 



7 r : _ z cone in to take care if = ■-. -i:.:.: 7 r : z .em 

• :.::: nay _- - _rr re=^li _- :::.r: =-=.== .£::.: ire 
pnnping un d er the federal lav. 

Z «: :e: _:' jzz ::.!: erlirrier ne : = ::_;_e :: 

r- e = - 1 r r. = zr.=.z - -- ~ :-rr: :i:ri I r - it e = imar • er -if 

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fr;~ Irr.rre = =- = -. :«_ller 5 i.-.e: Ike first one is »nc I k r ■ the 
:e:ir*r=:.: ::::.::f: = r.y .-.ir:f i^ -_- rev.ev :r ± i i_ = if - 

• = =-= s:rri- :i.i :r: if: : :_= :;-:i f :::.;r 

I- = = -ire r=Jie z .z I i:~ . cr : - if ie- L. = _r 
to their nane . 

So, he * s as kin r : : r = rtne z : : _re - - f re 1 i. z~ :z zz -.- zz 
a.-.ilysif N:« i.-.e e.:;: = very :e:f-: I'm £.:t :_ - = .e- z 
r.a: = ::.=.-.:■; ~r =. - s ver _" 

1R. GOULD: I have not seen it 

rl -:;- ?:7~Ir An ire :::.= : is lesrr-ie ire 
.;-;_; 7 ±i i = - = - r a - '.' 5 I : : _ : r .5e: - r :r:c.:= ire 
f5:.-i:f if ire i.-;.-. rf :r:::-." i-r-i-i-i-_-r~ 

MR. GOCLT: Yes. 

ri-T; r r I7-:5: An "~r •i-.f: -- :~e rf ire 

l-fi:.": r f 1 II < 1 ~ Z 11.11 Z~ZS _5 ill* I " fT: 1 e 1 1 _~ til 

this kind of waste cones from cranta :;.:.:i. : re : ■ i. : 1 - - 5 
:-.i: 2 vr: .erremre li. :r: :.f: :.*;y ?::.lr. : 

even be going into this dose 11 ought to be nc rrlmi i~z -hat 
perhaps should be a requirenerr 

I : y j _ if .;:-.: ? z _ f : : i : f i* r. re rr_ = :r = . r »r r<e 

:e;v;:r; y r 1 r_r." -- :-*i <eer -""* rf:y:l:r: zz iz ~ : z 



19 



56 

<|lumping the dangerous part somewhere else and then bringing in 
tjiore dangerous material for your production process. 

Do you have any comment on that? Have you had a 
^hance to study that at all? 

MR. GOULD: I have not looked at that issue. 

We have had some correspondence with the 
Congressman. 

The issue of the firm, U.S. Ecology, is one that's 
H>een under review for sometime. I believe they won the bid, if 
you will, back in 1986, if my memory is correct. And from that 
period of time — it's actually 1984 they were selection — 
there have been a whole series of reviews as to the firm's 
Solvency, its approach to doing business. 

There were problems in prior sites. I think in 
entucky and Illinois they had some problems in terms of how 
he sites were administered. 

Any liability problems they did fully back up. 
They have been much more successful in terms of operating a 
fcite in Nevada, which is much more similar in construction to 
jthe site proposed in Ward Valley. Ward Valley is, obviously, 
very deep in the desert, and it's much more similar to the 
iesign and the approach used in Bady, Nevada, which is very 
similar construction. I think there's been a solid record of 
operation for some period of time, nearly 20 years, as I 
recall, of that facility by the same operator. 

So, I think when we look at what occurred, both in 
Illinois and Kentucky, we have learned form that, but we're 



57 
lso learning a great deal from more successful operations in 
[Nevada . 

SENATOR PETRIS: One of the questions they raise is 
whether your people in the Department did some testing below 
the 100-foot depth. They say this is good down to 100 feet, 
and it won't — it'll dissipate or do whatever it does that's 
\safe. 

But they're raising the question, how do you know 
here isn't some contamination below the 100-foot level? And 
tohen you examine that, that's one of the questions I'd like to 
have you look out for. 

And the other is a question of liners. There's 
several agencies that recommended the use of liners. These are 
the Regional Water Quality Control Board for the Colorado River 
Basin, California's Integrated Waste Management Board, and the 
California Water Resources Control Board, and EPA Region 9. 
All of them recommended liners be installed in Ward Valley. 
They're not being installed. 

And the question is, is the Department on top of 
that? Is it done with the approval of the Department, or is 
the Department going to go in there and examine this question 
of the liners? Do you feel that it's an important safety 
measure, so that even if the other things fail, the liners will 
add the additional protection? 

MR. GOULD: That is a question that's been raised. 
And it's all part of the public input that's really gone on for 
a period of years. I think that issue is being assessed, along 



58 

with all of these, because they all have to do with liability 
and any potential hazard from it. 

SENATOR PETRIS: That's one of the problems, the 
public's liability. 

MR. GOULD: That's correct. 

SENATOR PETRIS: They seem to feel that the 
Department has rejected the liners. I'm not certain as to 
whether that's conclusive. 

MR. GOULD: Well, I think there are reservations 
about the liners, and that's one of the reasons why we're 
working very closely with the Department to understand their 
perspective in terms of how it actually might capture the 
material and actually create a more potential dangerous hazard 
in terms of how the liner might operate than without a liner. 
So, that is clearly an issue we're working with the Department 
to assess. 

But that's all part of the public input that we've 
received, and again, we're not taking that lightly. It's 
something we should look at closely. 

SENATOR PETRIS: They also point out that the 
Lawrence Berkeley Laboratory has developed a different process 
for recycling that seems to be much safer than the one being 
considered down there at Ward Valley. 

I'd appreciate it if you'd have somebody show you a 
comparison of those two. 

MR. GOULD: Okay, be glad to look at that. 

SENATOR PETRIS: Well, I guess I've taken enough 



59 
time for a while. I'll be back before it's over. 

CHAIRMAN ROBERTI: Before we take a break, I would 
like to see how many people choose to testify either in support 
— support for starters, and opposition? 

We ' re going to take a break and be back in ten 
minutes . 

[Thereupon a brief recess was taken.] 

CHAIRMAN ROBERTI: The Committee will reconvene. 

We were in the process of asking for support and 
opposition. The people in support, please come forward and 
identify yourselves. 

MS. GOLDEN: Yes, thank you, Mr. Chairman and 
Members . 

For the record, I'm Sherrie Golden, representing 
the California State Employees Association. 

I must tell you, I'm delighted to be here 
personally because Mr. Gould is also a personal friend. 

CSEA, as you know, does not take a lot of support 
positions on Governor's appointees, and especially at this 
level. But I must tell you that we're very, very happy to be 
here. 

CSEA and Mr. Gould go back a long time. He's been 
around labor organizations and unions since his early career in 
labor relations personnel, and also when he was with the 
Department of Finance. 

His open door policy and his approach to try to 
resolve problems is very, very refreshing in the arenas that we 



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work in when we are confronted with so many problems, so many 
people in high places, in high level positions, that really 

don't want to take the time to look at the problem and see if 

i 

there is a way to resolve it. 

We've always had a very, very positive response 
from Mr. Gould. 

A couple of years ago, when he was with the 
Department of Finance, PERS came to us because they had been 
turned down by Agency for a few additional positions they 
eeded in areas where services were greatly lacking to the 
embers of the system, where they had a lot of backlog. We 
(went to see Mr. Gould and discussed the issue with him, and 
made it very clear that we weren't there just representing 
pSEA, trying to get people jobs. We were there representing 
the recipients of the system who were having great trouble 
getting some services, and that they very much, in fact, needed 
these additional positions. 

He interceded in — for us, and during budget 
deliberations PERS was able to get some more additional 
positions that would make it easier for them to get the job 
done. 

So, it's situations like this that make us very, 
k/ery happy to see someone like Mr. Gould in this position. 
Health and Welfare is a tremendous agency with a lot of 
problems , and we have a lot of people over there . And there ' re 
going to be a lot of problems . 

And I think his background, because he's had such 



61 
tareat experience in all arenas, he can look at a problem from 
all perspectives; from the Administration's, from the 
employee's, from the Legislature's. And I don't think it's 
jgoing to be slanted. It's not going to be, "Well, I have to 
look at it just from the Administration's position." I think 
he's going to be very balanced. 

And for that, we are here supporting him and ask 
the Senate Rules Committee to confirm. 

CHAIRMAN ROBERTI: Thank you very much, Ms. Golden 

Are there any questions? 

Anybody else in support? 

MR. SKOIEN: Mr. Chairman, I'm Charles W. Skoien, 
Jr., a consultant at Community Residential Care Association of 
California. I've been in this industry since about '72, and I 
think Mr. Gould has shown since his appointment at least the 
door is open to us . In the last three or four months , he ' s 
called all the provider organizations in to at least discuss 
some of the issues and the problems that have faced this 
industry. 

It's an industry that's, in quotes, "a can of 
worms". You've got one-bed facility, 100-bed facilities, and 
there ' s many problems . 

We believe in enforcement. We believe in 
compliance. We also believe in consultation, and most of all, 
we believe that the consumer in these facilities, the special 
people, should be given a home with dignity and respect. 

We support Mr. Gould's confirmation. 



62 

CHAIRMAN ROBERTI: Thank you very much. 

Is there anyone else? Any questions? 

Anyone in opposition? Please come forward. 

MR. BRAVE: My name is Ralph Brave. 

Mr. Chairman and Members of the Committee, thank 
\you for letting me testify. 

I've never testified before, so I'm a little 
nervous, excuse me. 

I'm here today representing Americans for a Safe 
Future and a coalition of other groups which are concerned 
about Ward Valley. 

What I'd like — our concerns, as many of you know 
already, is that the project is being pushed forward by 
Mr. Gould and the Administration without proper attention to 
many of the complex issues involved, such as liability and 
bublic safety. And I think that that part of the problem was 
evident in Mr. Gould's responses to Senator Petris ' s questions. 
JThey were responses that were incomplete, were simply ignorant 
of the issues. 

Mr. Gould, for example, stated that 90 percent of 
the nuclear waste going to Ward Valley would be — not 90 
percent, but it would primarily be medical. This is simply not 
true. As any study of the waste stream would show, there is 
some medical waste, but the majority of it is not medical; the 
majority of it will be from the nuclear power industry and 
related utility operations. 

The question — one of the questions has to do 



63 

simply with the objectivity that Mr. Gould could bring to the 
Ward Valley issue as the Secretary. As you're aware, many 
individuals, groups, and Legislators have been asking tough 
questions of DHS and of Mr. Gould. And the answers in general 
have been slow, shallow, or incomplete, whether regarding 
liability, the waste stream, or the status of the land 
ownership of the project. 

Furthermore, DHS has the right to grant an 
a judicatory hearing, for instance, in regard to the very 
^erious details of the project. When asked to do so, however, 
by Legislators and public interest groups alike, the Agency 
refused. 

When there's a serious disagreement of experts in 
the field over these kinds of issues, especially regarding 
anything radioactive, it would seem appropriate to hold such a 
hearing in the interest of getting to the bottom of the issue 
and learning the truth. 

The State of Nebraska, for example, held detailed 
summer-long hearings over this very issue involving their 
designated licensee, U.S. Ecology, the same company at issue 
here, for this very reason. 

The State of California stands to suffer serious 
liability, health, safety, and environmental consequences were 
this project to actually move forward. And these consequences 
due to the highly dangerous components in the low level waste 
stream — and low level is something of a euphemism, because 
some of the material has half lives of up to four-and-a-half 



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billion years. These components will plague future generations 
long after accountable individuals and agencies are nothing but 
a dim memory. 

In addition, environmental documentation should 
ave included alternatives to the project but failed to do so. 
As with any hazardous substance, reduction of waste and 
aggressive studies on clean, non-nuclear alternative technology 
should have been but were not pursued. And I think that was 
evident today under the questioning of Senator Petris and Mr. 

ould's responses. Alternative methods of storage should have 
been investigated. 

Furthermore, there is the question of Mr. Gould's 
^relationship with the nuclear waste industry. In an October, 
1991 letter from the P.R. firm Winner/Wagner and Associates to 
the nuclear industry lobbying group Cal Rad, a meeting is 
specifically mentioned in order to, quote, 

"thank Gould for his informed and 
articulate support for the 
project. " , 
Unquote. And to, quote, 

"invite Mr. Gould to join us at the 
editorial boards to express his 
thorough analysis of the safety and 
need for the Ward Valley project," 
unquote. 

I have a copy of the Winner/Wagner letter here with 
the statements regarding Mr. Gould and their work with him. 



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You'll find it on Page Three of the letter. 

Several questions, of course, are raised regarding 
the level of intimacy in the relationship between Mr. Gould and 
the nuclear waste industry and their lobbyists. One, has 
Mr. Gould openly supported this project despite outstanding 
unanswered questions? Two, has Mr. Gould met with industry 
representatives? He he also met with public interest 
individuals or public groups opposing the project? And three, 
has Mr. Gould attended any editorial board meetings with Cal 
[Rad Forum and/or U.S. Ecology representatives to express his, 
quote, "thorough analysis of the safety and need for the Ward 
Valley project," unquote. 

While obviously at this time we cannot say that 
Mr. Gould acted inappropriately, there is certainly the 
question of the appearance of impropriety. And I'm sure that 
jMr. Gould would prefer to dispense with this issue now. 

Indeed, Mr. Gould should be questioned at length 
about his current and past relationship with the nuclear 
industry in general, and U.S. Ecology's lobbyist, Mr. Craig 
Fuller of Hill and Knowlton, who's been hired to lobby on this 
issue and apparently lobby Mr. Gould as well. 

In conclusion, California citizens deserve the best 
possible candidate for the important office of Secretary of 
Health and Welfare. Thank in advance for your efforts to 
ensure that this does indeed take place. 

Thank you. 

CHAIRMAN ROBERTI: Thank you very much. 



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Senator Mello. 

SENATOR MELLO: You seem to know a lot about this 
incident, about this activity. 

What is your solution to this problem? 

MR. BRAVE: Well, I think that there are 
alternatives to Ward Valley. Number one, there are existing 

lternative technologies for recycling some of the most 
dangerous waste, and primarily that coming from the medical 
industry. And there is no reason to put it into the ground. 

But as far as I know, and it seemed apparent from 
Mr. Gould's responses to Senator Petris, this issue hasn't even 
been looked at by the Administration. 

SENATOR MELLO: But in recycling, do they make the 
iradioactive material neutral? Do they neutralize it? 

MR. BRAVE: Some of it is neutralized, yes. 

SENATOR MELLO: You say some. There is some that 
lis not neutralized? 

MR. BRAVE: Right, there's a very small proportion 
jwhich could be — which is not, you know, very small percentage 
of the medical waste which could not be recycled but which 
could be held, because it's so small, in on-site storage. 

SENATOR MELLO: Thank you. 

MR. BRAVE: Thank you. 

CHAIRMAN ROBERTI: Anyone else? Any other 



questions? 



MR. BRAVE: Thank you again. 

CHAIRMAN ROBERTI: Is there anyone else here in 



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67 
opposition? This gentleman and then this gentleman. Please 
come forward. 

MR. LIM: My name is Nilrosino Lim. I am 
representing the Filipino-American Care Providers of 
Sacramento. 

CHAIRMAN ROBERTI: Which providers? 

MR. LIM: Filipino-American. 

We are having around forty members right now, and 
We would like to register our opposition to the confirmation of 
the Russell Gould appointment on the ground that we are 
suffering under CCL policies and implementation of those 
policies as far as Filipino care providers are concerned. 
Somewhere along the line, our rights as a citizen are not being 
respected. 

Due process, the appeal process is not being 
followed. The obligation process is being dragged down to one 
year to two years that we suffer. I don't know how much money 
is involved in here. We paid the mortgages of the home until 
after citation, and citation after another until after we get 
the license. And aside from that, once we get the license, we 
— we were cited for small things, you know, and not uniformly. 
There are those who want the kitchen closed, the evaluators, 
and there are those evaluators who doesn't want the kitchen 
closed. The gate's closed, and some of the evaluators want it 
open. 

There is no uniformity as far as these policies are 
concerned, and we find it, you know, trying to look out for 



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something that ' s not there . You see it and you don ' t . And 
that leaves us in a position where we don't know anymore how to 
care for our clients. 

And we look at Community Care Licensing as an 
agency of the government that would be supporting us to upgrade 
our services to the clients. Basically we spend 24 hours a day 
and night, seven days a week with our clients, and we expect 
some support . But we don ' t get support from any government 
agency. 

We lose our money. We don't have the right to 
collect whatever due for board and care. I inquired from the 
Legal Center here in Sacramento once. I had a client who owed 
me almost 6,000 in room and boarding care rent. I asked 

icensing what can we do about this, if they can help us. The 
lawyer can't help us either. 

And in the process of appeal, they closed the 
facility before they tried to schedule the hearing. And it 
takes, I think, in my case it's seven months now I haven't been 
heard by the Legal Department of Community Care Licensing. 

So, as far as the other groups is concerned, they 
have the same experiences and grievances. 

And I thank you. We needed to be heard by this 
body, because I think there must be some revision on the Title 
22 and Title 17 that gives authority to Community Care 
Licensing. And because of this, I think misdirection of 
Community Care Licensing, I don't know whether it's in — built 
in in the regulations, or within the authority exercising 



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supervision over this Agency, it's not giving the right 
direction. 

Because basically, our concern is the clients. But 
they are hindering us to give the best possible service to our 
clients. By imposing citations they expect us to be janitor, 
cook, security at night, accountant, dietitian, pharmacist to 
dispense this medication. And yet, we are trying to cope up 
with these duties, and we love this because it is our interest 
and vocation. But they close our facility, disrupt the 
relationship with our clients. 

And one of them could have been, you know, could 
have been accident, because I know that one of my clients just 
wanted to go to the highways and kill herself. And when she 
was removed from my facility, there was a danger. Up to now, I 
don't know where she is. But before she run away from 
California, I heard that she was in what they call New Mexico. 
And I hope everything goes with her fine. 

However, going to the opposition, I find the 
connection of Russell Gould negligent in giving the right 
direction for the agencies under his department. 

Thank you, your Honor. 

CHAIRMAN ROBERTI: Senator Petris has a question. 

SENATOR PETRIS: What was the ground for suspension 
of your facility? 

MR. LIM: First, after citation, I filed my 
application for more than a year, and they cited me without 
appeal for minor things, like temperature water, which was 



70 
readily corrected. 

The last thing that I can remember, and I thought 
was the main cause of the closure, was the moving out of the 
pool table from the living room. The evaluator wanted the 
living room back, but since I have many clients and they always 
want to use the living room as a pool table, so we moved the 
sofa in my office and we up the pool table in there. And they 
enjoyed it. They never complained about it, and they like it 
ery much there . 

SENATOR PETRIS: You were suspended for that, 
moving the pool table? 

MR. LIM: Yes, that was the initial understanding I 
had. 

Then later on, after the closure, I was notified by 
the Legal Department that I was charged accused of sexually 
molesting my clients, all of them. And the basis of their 
accusation is one written testimony of one client who was my 
relative, and you could talk to her psychiatrist about the 
matter. And they started having investigators talk to my other 
clients, and you know, when they are mentally ill, they are 
easily prone to change their mind. And the questions that the 
investigators are asking them are so much, you know, leading, 
"Don't you know that Mr. Lim raped everybody in that facility?" 

And one of them is Kathy Seaton who almost is my 
daughter. You know, she calls me Dad when her father died, and 
she says, "No." But in the report, the investigator is, when 
they say "No," and they cried. And they make it appear that, 



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you know there was something that happened. 

You see, I don't know how much money is spent by 
going around and talking to all my clients. However, I 
appreciate that, so that, you know, all my clients could be 
intact again. 

SENATOR PETRIS: How many people in your facility? 

MR. LIM: There were seven, sir. 

SENATOR PETRIS: Isn't the normal procedure for the 
Department to issue a citation and then give you time to make 
corrections to whatever the problem is? 

MR. LIM: I was expecting that, sir, but it didn't 
— it never happened to my facility. They just closed it 
down, transferred all my — without having the consent of my 
clients . 

My clients doesn't want to move out. They also 
violated the rights of the client, too, the place where they 
want to live. 

As a matter of fact, most of them are — who are 
still here, comes around and calls by phone. They want to go 
back. 

SENATOR PETRIS: Where is that located? 

MR. LIM: It's at 2942 and 2950 Soledad Way, off 



Broadway . 



SENATOR PETRIS: Here in Sacramento? 
MR. LIM: Here in Sacramento, sir. 
SENATOR PETRIS: Thank you. 
CHAIRMAN ROBERTI: Any further questions? 



72 

Thank you, Mr. Lim. 

Someone else in opposition? Please come forward. 

MR. DOBSON: My name is William Dobson. This is my 
wife Ruth Dobson. 

Up until a little over a year ago, we operated a 
care home for the aged in Gait, 15 people. Until one day, 
about 40 people at someone from Mr. Gould's office came down 
and took the 15 residents away. 

We pleaded with the lady who had been down, the 
leader of the group. The leader of the group had come down a 
week earlier, completely inspected our facility, gave my wife a 
statement saying: no deficiencies. 

And on the day when she came, the day when she came 
with all these people, we knew -- we had no idea what she was 
going to do there with all those people. All of our front 
yard, all in our living room, even across the street in our 
neighbors' yards, cars double-parked and tripled, or whatever, 
here they are; here our people are. 

She announced that she was going to take our 
residents. And I said, "Wait a minute. What for?" 

She said, "One of them accused your wife of 
abusing a resident." 

The incident referred to was one in which my wife 
was carrying a tray from this patient's room. The patient 
picked up a walking stick, a cane, and hit my wife from the 
rear. My wife fell to the floor. One of the residents who 
happened to be a Hall of Famer Olympic swimming coach, 80 years 



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old, pounced on the lady, broke some bones, and that was the 

incident. 

The police investigated. They talked to the 

witnesses. They talked to our cook. They talked to other 

residents eight or ten feet away who saw everything that 

happened . 

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And yet, when I tried to explain this to the lady 

who was in charge of the troops that day, who stormed in our 

place, I said, "Well, look. The police came. They 

investigated. They didn't do anything to my wife. They did 

take this woman to Mental Health up in Sacramento from Gait." 

My wife had done nothing to be closed down as she 
was . 

Before they left, and before they really got 
started dragging the people out — literally dragging them out 
— I said, "Who is your boss?" She said, "Fred Miller." I 
said, "Let us talk to your boss because if all these people you 
have here, you can interview every one of our patients. If you 
find that any of them say that they have been abused, take all 
the people. Conversely, if you find that none of them say they 
have been abused out of 15 people, leave the people alone." 

Several died after they took them away, but anyway, 
I talked to Fred Miller. I told him the circumstances. I told 
him the police had investigated; had done nothing to my wife. 
And there was no abuse . 

"Well, we got to take them out today by 5:00 
o 'clock. " 



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I thought it was pretty stupid, but you know, he 

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had the power. He had signed the Temporary Suspension Order, 

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which is a vicious animal, if you gentlemen and ladies are not 



familiar with it. It says whenever in the thought of God — in 
that instance Fred Miller -- he felt a violation had been 
committed, he could suspend the license. 

My wife had been in business for 15 years with the 



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After Mr. Miller told me that, I said, "Let me 
speak to your lawyer." I happen to be a lawyer of some 30 
years, and I thought maybe the lawyer and I could talk sense to 

each other. 

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Just like lock-step, he says they got to take the 
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people out. With nothing, literally nothing to base their 

decision on. 

Certainly, Mr. Gould, I would hope that if you 
become Director, you will seek to change the Temporary 
Suspension rules to state that, as the Code of Civil Procedure, 
Section 52 7 requires, before a restraining order may be issued 
by a judge in California, both parties must have been notified 
and given an opportunity to be heard by the judge who is being 
asked to sign the restraining order. 

Presently, these people have too much power, 
jbecause they don't have that requirement. This man signed in 
his little office a Temporary Suspension Order and literally 
put us out of business. 

You see, when you cut off the paychecks of 15 



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people, you're paying $4,000 a month on your facilities, 
doesn't take but a month or two and you're gone unless you got 
a heck of a lot of money. All on account of, I think, 
stupidity. 

All I asked the lady to do was to ask the people. 
Those people wouldn't lie to her, 70 and 80 year old people. 

Some of them literally had to be dragged from the 
premises . 

We also gave affidavits and all that sort of thing. 
All to naught. 

So, we were thrown out of the business. 

Sure, I came down to get a restraining order from 
the Superior Court the same afternoon, but it was a Friday 
afternoon, and Presiding Judge Ford at the time said, "Well, 
you'll have to notify the other side, come back Monday 
afternoon, " as I think the Department should have notified us 
of their plans so we could have come before somebody, some 
impartial decision-maker, to close us down. 

That, you gentlemen and ladies, you have some 
power about you, that must be changed. It gives too much power 
to one man, to completely throw people out of business, I think 
as the other gentleman testified to. No one man in America 
needs that much power over other people. He wrecks their lives 
by throwing them out of business. He disturbs the seniors and 
others by giving these orders without any corroboration. 

Our proposal is that before any of the 
investigators ' information from the Community Care Licensing is 



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acted upon, there must be some corroboration. That's all that 
r. Miller must have acted upon in our case. 

And I would hope, Mr. Gould, you wouldn't fall in 
that trap. You probably don't know about it, but anyway -- 

SENATOR PETRIS: I have a question. 

MR. DOBSON: Yes. 

SENATOR PETRIS: As a lawyer you can answer. Is 
there a legal remedy? Is there an appeal that lies with that 
ind of an order? Was there one taken? 

MR. DOBSON: We started it, Senator, but, you know, 
trying to keep payments up on this place and our home, we just 
couldn't hang — I mean, we couldn't afford to. I mean, we had 
no money. 

SENATOR PETRIS: So there wasn't any legal process 
all? 

MS. DOBSON: Your Honor, we were intimidated into 
sending the license in by State Licensing. 

SENATOR PETRIS: Is that Mr. Miller again? Did he 
i that? 

MS. DOBSON: Mr. Miller was not present, but it was 
the State Attorney General's lawyers who I told they didn't 
have to revoke my license because my morals, my upbringing, and 
my training told me I didn't have to deal with scum bags that I 
was dealing with that day, and I would mail my license to them 
because they kept moving the goal post on me. 



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SENATOR PETRIS: Did they give you any written 
document, other than -- I assume they had something in writing 



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regarding -- 

MR. DOBSON: Temporary Suspension Order, signed by 
:Miller, uncorroborated. 

SENATOR PETRIS: Was there any other document 
attached to that, any affidavits or complaints? 

MR. DOBSON: Nothing else. They just came and took 
the people with that Temporary Suspension Order. 

SENATOR PETRIS: Did they send you any letters or 
documents afterward -- 



MR. DOBSON: We met with — 

SENATOR PETRIS: -- explaining the reasons? 
MR. DOBSON: They listed those in the Suspension 
Order, and one of them, the only -- really the only one, I 

I] 

think, was alleged abuse. 

SENATOR PETRIS: For that one incident? 

MR. DOBSON: Yes, out of 15 years. 

SENATOR PETRIS: Any questions by any of the 



Membe 



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say -- 



Did you wish to testify also? 

MS. DOBSON: Your Honor, the only thing I have to 

SENATOR PETRIS: Could you give us your name, 



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please? 

MS. DOBSON: My name is Ruth Dobson, and I have 
been in the care home business for 15 years. Prior to that, 
ten years with the federal government. Prior to that, five 
years with the state government. 



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And the type of treatment that I received by 

ommunity Care Licensing and the state investigator at the time 

of my closing of my home, I am here after being traumatized for 

Dne year under the doctor's care, to roll my sleeves up and 

help write the language to change the laws if I have to. 

If it doesn't do me any good, it's going to help 

thers . I do not want to go back into the business. I am ill 

from the business, but I am willing to work with people to 

write changes and help others so it won't destroy any more 

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other families like it has destroyed mine. 

My husband's blood pressure went so high until it 
affected his eye sight where he couldn't see out of his left 
eye. It's an irreparable damage. 

I have been under the doctor's care for one year. 
iThank God I'm on my feet now, and I'm going back to work, but 
by the grace of God, these laws must be changed. 

SENATOR PETRIS: Tell us, if I gave you a pencil 

! 

and I said, "Write the changes that we need, " what would you 
recommend? 

MS. DOBSON: I have them here, sir. 

SENATOR PETRIS: Okay, let's hear them. 

MS. DOBSON: The roles allowing Community Care 
Licensing to issue a Temporary Suspension Order must be changed 
to comply with Section 527 of the California CCP, which must be 

followed to get a restraining order. That change will provide 

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due process, which none of us have gotten, for the 

administrators to Community Care Licensing. 



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There must be a nonbiased mediation board. No one 
talked to me except one person. No one sat down with me and 
said, "We have a problem. " Not one person. 

SENATOR PETRIS: You didn't even get a phone call? 

MS. DOBSON: I placed a phone call, and I got an 
answer a month later. My clients was moved two months later 
after the incident. 

And I am this abusive person, when people had been 
in the home over seven years, moved with me from Santa Clara 
County, which Phyllis Eversole tried to stop at that time in 
1976 -- in 1987, when my facility caught fire in Los Gatos, 
California. By the time Phyllis Eversole got through with me 
jand I got to Sacramento at 6:00 o'clock, my clients and I 
walked into Gait, someone from Sacramento Licensing was on the 
telephone advising Mr. Brown that I was a very bad person and 
don't hire me in the facility. 

He said, "You have had eleven years to take her 
license. Is she a criminal?" 

"Oh, no, no, nothing like that." 

SENATOR PETRIS: Who's Ms. Eversole? 

MS. DOBSON: Phyllis Eversole has been the — a 
person in Licensing from Santa Clara County who has now moved 
to Sacramento with the same type of discrimination, 
harassment, and intimidation tactics that she used in San Jose. 

SENATOR PETRIS: And who's Mr. Brown? 

MS. DOBSON: Mr. Brown was the administrator and 
owner of the care home that opened his doors for me and my 



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clients when our facility caught on fire in Los Gatos . 

SENATOR PETRIS: After that incident, did you try 
to get ahold of Mr. Gould to bring the complaints before him? 

MS. DOBSON: We didn't get that far. 

I was so traumatized and devastated, I finally took 
myself to the doctor because I didn't have sense enough to know 
that I was just walking in circles. I was dysfunctional. 

SENATOR PETRIS: That's a pretty traumatic 
experience. I think everybody will agree to that. 

Are there questions from any of the Members of this 
jwitness? 

Okay, thank you. 

MS. DOBSON: You're welcome. 

MR. DOBSON: Thank you. 

SENATOR PETRIS: Are there any other persons here 
to oppose the nomination? We'll get support afterward. 

There's one support witness who hasn't testified. 
lis Mr. Hausey here? 

MR. STEVENS: Good afternoon, Senators. 

My name is Sam Stevens. I'm a business — small 
business owner in San Diego, California. 

As a member of the Downtown San Diego Host Lion's 
Club, I became involved with a facility called Boys and Girls 
Mental Health Centers in El Cajon. The Lion's Club was a 
fairly significant contributor to that facility, and as a large 
contributor, held a majority position on the Board of 
Directors, and that's my involvement. 



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My involvement with them came about a little over 
three years ago. And I was a Board member for three months — 
or six months, I guess, and then was elected as President of 
the Board of Directors and held that position until November of 
this year. During that period, there had been a number of 
changes in the mental health care field, and essentially what 
I'm going to testify about is our situation, or my experience 
with Community Care Licensing in that endeavor. 

Because of some changes in the health care field, 
it was necessary for us to change or population from third 
|party clients, or third party referred clients, to all county- 
funded clients specifically from San Diego County, Department 
of Social Services, San Diego County Probation Department, and 
the San Diego County Mental Health. 

We have a 52-bed facility with another two group 

Ihomes . The agency has been operating since 1903. In our 

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current facility of 27 and a half acres, 52 beds in El Cajon, 
for the last 27 and a half years. 

We have an exemplary record of serving the 
community of San Diego. And during this change, the down- 
sizing, we went through three down-sizings of employees from a 
high staff of about 145 people down to 63 people, necessitated 
by cuts in available funding, but cuts in the amount of clients 
that we were able to serve, and so that necessitated the change 
to county- funded kids. 

We were serving that community, and all of a 
sudden, our staff was beat up. The clients we're serving are 



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inuch more significantly disturbed. And so, we ended up in July 
pf last year with some significant problems because of the 
(situation. And Community Care Licensing became involved 
through an anonymous complaint and came out. 

Our crisis, really, was during the July 4th 
weekend. Community Care Licensing came out a couple of weeks 
later, did an investigation, and issued a complaint, which we 
responded to. Started taking corrective action. 

Thirty days later, Community Care Licensing sent 



o 

back their recommendation on the changes that were needed. And 

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part of their recommendation was that they were not going to 



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renew our license, and so we filed an appeal. 

Shortly after we filed that appeal, a Temporary 
^Suspension Order was cut. At that point, we were not given an 
opportunity to appeal. 

What had happened -- 

SENATOR PETRIS: Who issued that order? 

MR. STEVENS: Fred Miller. 

SENATOR PETRIS: You talked to him about it after? 

MR. STEVENS: Afterward? 

SENATOR PETRIS: Yes. 

MR. STEVENS: No, at that point, no. 

What transpired was that the Executive Director, 
who had been hired in May, and who, after this crisis in July 
had taken steps to correct the problems, we had been operating 
;with Community Care Licensing making repeated checks with no 
deficiencies . 



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And on, I believe, October 3rd, we were — the 
Executive Director and I were asked to come in to Community 
Care Licensing' s office in San Diego, and we were served this 
Temporary Suspension Order. We were told to fire the Executive 
Director, and there were four other items on that particular 
complaint. And that -- we were told that there was a Temporary 
Suspension Order. We were told to fire the Executive Director 
and to take the four steps of corrective action, which we had 

already taken. 

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I was asked -- the only question that I was asked 
in that conference was how do I feel about that. And my 
response was that I was shocked and angry. And that was all 
that I was able to give as an appeal . 

I was given ten days to fire the Executive Director 
and to implement these four changes. 

I didn't have the authority to terminate the 
Executive Director. We called an emergency Board meeting the 
following week. I explained the situation to the Board of 

irectors. I showed them the hand-written citation from 
(Community Care Licensing. The Board, in what I consider their 
jwisdom, decided that there was no wrong doing by the Executive 
(Director. And I know this personally, because I spent my own 
{time there. And as a matter of fact, in the last two years, 
jl've got to say that I probably spent 25 percent of my working 
hours devoted to Boys and Girls Mental Health Center for no 
pay, as a volunteer. 

The Board supported not terminating her, and 



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shortly, two days after that emergency Board meeting, I called 
Community Care Licensing and said, you know, "We have decided 
we are not going to terminate the Executive Director. We 
cannot determine any wrong doing. We would like to have the 
opportunity to discuss what our views of the situation are." 

I was told by one of the employees, because the 

i 

division leader at that point was out of the office, and he 

assured me that we would be given an opportunity to express our 

views on what happened. 

The following day was the deadline, and at 10:45 in 
the morning, the chief of that division called me at home and 
asked if I had fired the Executive Director. I told her I had 
not, that I had placed her on administrative leave pending the 
agreement that I had the day before with the next in charge 
that we would be given an opportunity to appeal. 

And she said, "Well, that's not the case. And the 
Temporary Suspension Order was served, and we are closing your 
facility. " 

SENATOR PETRIS: Who was that? 

MR. STEVENS: That was Mary Delmast. 

SENATOR PETRIS: Out of Sacramento? 

MR. STEVENS: No, she was — she's the head of the 
San Diego office. 

We — I pleaded with her to hold the -- serving the 
order, if that was her determination to do that, that's fine, 
but at least give us an opportunity to counsel the children, 
counsel the staff. Some of those children had been in that 



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facility for over two years; that was their home. 

These children that we serve come from the worst 
possible deprivation that mankind can see. These are terribly 
traumatized children. 

That's not to say that they're really pleasant to 

be around at all times. They are not. They are disturbed 

i ! 

(Children. 

I pleaded with her with tears running down my face 
|to please to hold the order so at least we could counsel the 
children, and she would not do that. 

The order was served. She sent one of her people 

put to the agency to sit and watch that the children would be 

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removed. Two hours later, the vans drove up and the children 

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!were taken out. 

There was -- it was -- to try to describe the scene 

lis one of the most sad things that I can tell you. The 

children were terrified. There is a room in that agency that 

sits there today with possessions that some of these children 

had, and these are children that don't have traditional 

families. They were taken out so soon that they could not take 

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with them some of their radios, some of their clothing. 
There's one child that has written for his teddy bear that we 
can't find. It's been misplaced during that raid. 

It was -- it was a terribly traumatizing situation, 
■not only on the children, on the staff, and on the Board, and 
all those people that were involved. 

We were never given an opportunity, other than to 



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file an appeal on the not renewing our license. And at that 

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point, that's when we were threatened with the Temporary- 
Suspension Order. 

Throughout this process, the media was brought in, 
and I can only assume that it was brought it by Community Care 
licensing, that there was an awful lot of terribly unfavorable 
publicity. 

In an agency where there were some identifiable 

problems, problems that were corrected, and then to have those 

problems corrected for a month and a half, and then to come in 

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|}and serve a Temporary Suspension Order because we had the 

audacity to file an appeal is just beyond me. 

To ask that an Executive Director, who has done 

nothing but change the agency for good, from a terribly 

(difficult situation, to ask her to be terminated, this woman is 

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snow black-listed in the care-giving industry in our community. 

I, 

She's been involved in this industry for the last 15 years, 

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done an exemplary job. Came recommended by an incredible 

lamount of very well-placed people within our community. This 

Woman is going to have a very difficult time getting a job. 

The staff was coerced by the state's attorney. The 

Original came out -- complaint came out saying that staff stood 

by while children cut on themselves, while children had sex 

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with each other, and while children drank alcohol and had drugs 

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jin the facility, which has been completely unsubstantiated. 

And it was obviously the great — it was the — the 

press had a field day with that. You know, all you need to do 



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was have sex, drugs, and teenagers in the same sentence and it 
is a field day. 

SENATOR PETRIS: Was all this based on an anonymous 
complaint? 

MR. STEVENS: It was started on an anonymous 
complaint and an anonymous letter that went to CCL. 

At that point, when we -- when the Board of 
Directors decided to defend ourselves on the TSO, the state 
started building a case, and we started building a case. The 
state's case was originally built on this anonymous letter, the 
testimony of a child that was in the facility that had a 

history of — in the terms of one of the youth development 

! 

counselors -- whose practice was to gross out adults by these 

gross misstatements. 

This is the type of thing that the TSO was built 
on. 

We hired an investigator to go back and interview 
staff, get signed statements from the staff refuting the vast 
majority of the claims by the state. We have gone through 
considerable expense in defending ourselves. 

We got to a point where the Board tried incredibly 
lhard to reopen the agency, to continue to serve children. We 
have an auxiliary of 260 members that works terribly hard to 
contribute money toward this facility. 

In the defense, it got to a point where we could 
continue fighting, similar to an innuendo that, "Do you still 
beat your wife?" It was not a position that could be defended. 



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I don't think that there's a residential treatment 
center facility similar to ours that has not had some incidents 
that you could put in the paper and create dramatic headlines. 

I have talked to the county agencies that we 
served, and because they also have to handle at various times 
these same children, they have had the exact same problems that 
We have. Our situation was not different. It was not out of 
the ordinary. 

It was not right, but it was not one that was 
vastly different from any other. 

I have no idea why we were singled out, or I felt 
like we were singled out for this type of horrible action. 

SENATOR CRAVEN: May I interrupt you for a moment 
and ask the Senators if they have any other questions of this 
witness? Senator Petris. 

SENATOR PETRIS: I just have one or two more. 

SENATOR CRAVEN: Fine. Well, I thought if we could 

igo, rather than just have him give us a recitation of this, 

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which is very interesting and certainly must be germane, but 
Jl ' d like to try to move it along a little bit. 

SENATOR PETRIS: How would you correct this policy? 

MR. STEVENS: By all means, by giving the providers 
an opportunity to respond to any action. 

I would think that the first thing that Community 
Care Licensing should endeavor to do, particularly in almost 
every situation, but this was a nonprofit agency made up of 
volunteer directors, paid staff, but give them the opportunity 



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to negotiate in the correction process, to be able to at least 
express their views prior to a Temporary Suspension Order. 

I understand when there are life-threatening 
situations, and I'm sensitive to that. 

In this situation, we're talking about six weeks 
after the last reported incident, they serve a Temporary 
Suspension Order. We had 38 children in the facility at that 
moment . 

By all means, the attitude of that agency has to 
change. It has to change from being an enforcer, and I mean 
ienforcer in the most punitive sense, to one of cooperation. 
How can we better keep a facility like this open? 

We have a tremendous -- we have between 8 and 10 
million dollars' worth of assets that we're trying to 
[contribute to the community that we are not going to be able to 
do now. We feel so prejudiced by this agency, Community Care 
Licensing Division, that we will never, ever open another 
facility like this. 

The Board is beat up. The Executive Director is 
trashed. There is a Residential Director that can no longer 
work in this state. 

It has to — the attitude has to change, and it has 
to come from the top. 

SENATOR PETRIS: That's why you're here. 

MR. STEVENS: Yes, sir. 

SENATOR PETRIS: Thank you. 

SENATOR MELLO: Mr. Chairman. 



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SENATOR CRAVEN: Senator Mello. 

SENATOR MELLO: I'm really surprised by what I'm 
Rearing here today, because I know Fred Miller and worked with 
pirn a lot on legislation. Senator Petris and I probably 
carried most of the legislation relating to licensing and 
penalties . 

There were a lot of problems in the whole area of 

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residential care, clear on up to skilled nursing facilities. 

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What I'd like to ask Mr. Gould to do, if he could 

ave Mr. Miller or your Department send just a brief summary of 

these two cases, the Dobson cases and this one here, and 

perhaps Senator Petris would like a copy as well. 

I just want to review them, because I'm interested 
in if there's legislation needed, we also have this report, I 
guess, that came out from your Department on the training 
program regarding to some of the problems in the Community Care 
Division. 

I would like to take a look at this whole due 
process. I don't think it was ever my intent that a Temporary 
Suspension Order would close you down automatically, because I 
think the word "temporary" means it goes through the process, 
and you get a response, and then whether or not the Temporary 
is made Permanent or not, that usually has a time lag. 

I don't know who carried the legislation that you 
have operated under, but I will certainly take a look at it 
through my Subcommittee on Aging, and try to see whether or not 
there's need for review and helping to improve the due process 



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91 

so that people are just not shut down and the clients moved out 
with no such notice, which is even more disruptive. 

But I'm still committed, as I know Senator Petris 

lis and others, to really enforce the Class A and AA violations 

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that cause harm to the patients, have caused death, and many of 

the unsanitary conditions, and the real lacking of proper care 

amongst the whole institutional care. 

Bearing in mind that I think we in government are 
partly to blame. We just have not provided the funding to 
provide the quality of care that we're all asking for, 
especially in the Community Care Division. It's been marginal 
at best. 

So, Mr. Gould, if we could get those, just a brief 
summary, to see just where we might be of some assistance. 

MR. GOULD: We'd be glad to look at these cases 
that have been described here today. 

And as you mentioned, there are a whole series of 
changes that we are making to the program as a result of doing 
round table meetings throughout the state. And Senator Watson 
and Assemblyman Bates were instrumental in really setting a 
focus for that so we could get input from providers and 
understand where problems were. 

We understand the changes have to be made in the 
program. We're pursuing that and have taken steps to implement 
it already. 

So, we believe we're on the right track. We'll be 
glad to look into these, and if additional legislation is 



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necessary, we can certainly work with you on it. 

SENATOR MELLO: Thank you. 

SENATOR CRAVEN: May I ask you a question, 
Mr. Gould. 

These changes that you are contemplating, do some 
of them touch upon those situations as described by the 
witness? 

MR. GOULD: Yes, Senator, they do. When we look at 
^Temporary Suspension Orders — and they do happen infrequently. 
Iwe ' re talking about three-tenths of one percent of the 
facilities, and we have nearly 90 facilities — 90,000 
facilities throughout the state. So, it's a very small number 
where that Temporary Suspension Order is required. 

Where we have changes in terms of notifying the 
provider about any issues regarding -- that are under 
consideration or investigation, trying to work more closely 
ijwith them so they understand the issues involved. 

Our intent is to try to assure that we have a 
quality home for the residents. And I think our obligation is 
to work with the providers to make sure that we have that 
mutual -- 

SENATOR CRAVEN: Well, I think what we must do is 

to be ever cognizant of the fact that despite the miniscule 

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percentage of the whole, it is a maximum thing to the person 
who has to live under it. And therefore, it deserves full and 
total clean-up. It would appear that way to me. 

I heard some of your testimony on the television 



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lupstairs, and I think that the situation deserves a great deal 
of looking into, and I'm sure you would agree. 

I think it ' s certainly to your credit and the 
epartment that you have, or the Agency that you have, that 
you've already taken steps. 

How long do you think it'll be before you can 
implement those items? 

MR. GOULD: We have nine specific changes that we 
Will be implementing. A number of them go into effect March 
1st, so we're really talking about just a few days for what 
l-ooks to be half of them. And others will be going into 
effect, all of them, by July 1. So, we have nine different 
jchanges . 

SENATOR CRAVEN: Do you contemplate more beyond 
that? 

! 

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MR. GOULD: If necessary, sir. We — one of the 
issues is, a number of people have raised the concept of an 
ombudsman relationship, to try to have a mechanism to work with 
providers, to try to resolve complaints. 

We do have in mind something, we're calling it a 
Technical Support Unit, which would go out to facilities that 
are having problems to work with them to resolve problems as 
opposed to looking at an enforcement action. 

So, we're open to looking at that process. Whether 
an ombudsman-style structure, or this Technical Support is the 
right answer, we do think we need some kind of way to work with 
providers to solve problems as opposed to looking at the 



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nforcement side. 

SENATOR CRAVEN: Would that ombudsman that you 

envision be with the Department or with the Agency? 

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MR. GOULD: Well, right now, what we've looked at 
is within the Department. 

SENATOR CRAVEN: So, in other words, the people 

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closest to it would be involved. 

MR. GOULD: That is correct. 

SENATOR CRAVEN: Would they be in touch with your 
office at the same time? 

MR. GOULD: I certainly believe they could be. You 
know, what we're trying to do is to open up the process to 
resolve problems. And if they need to come to the Agency to 

get either further direction or to change the approach, we're 

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bpen to do that. 

SENATOR CRAVEN: It appears that there seems to be 

fa lack of chronology in handling this, that things don't fall 

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into place as they should, and the people are left high and 

dry. They have no way no recourse, no redress, nowhere to 

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(turn, and they're just beside themselves, and it's very, very 
understandable. It certainly is a traumatic situation which 
they must face. 

I did want to get that on the record. 

Do you want to sum up your comments, sir, please? 

MR. STEVENS: I don't know if I can really address 
many other issues, other than just again to really urge that 
there are some changes that absolutely have to be made. 



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SENATOR CRAVEN: I think we all recognize that. 

MR. STEVENS: We — we just — we feel as totally 

distressed as you've expressed. 

SENATOR CRAVEN: Well, your being distraught is 

certainly very reasonable, to say the least. I think you've 

handled yourself admirably well in expressing those things that 

have happened to you, and you've made a very good presentation 

in my judgment. 
! 

MR. STEVENS: Thank you, Senator. 

SENATOR CRAVEN: Thank you very much. 

Now, these are persons who spoke in objection, is 
that correct? 

There are others who wish to speak in opposition? 
Yes, there are. 

Dear, would you come up, please. State your name 
and address. 

MS. DOYLE: My name is Ruth Doyle. 

Excuse the way I'm dressed. My father's in ICU 
having brain surgery tomorrow morning. But I came because it's 
really important to me to be here today. 

I'm one of the few people that have spoken today 
jthat have actually met with Mr. Gould. That's why I wanted to 

talk. 

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And it seems like there could be an opinion that 

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maybe a lot of the things that are going on, he's not aware of, 

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or that they're happening on a lower level, so therefore, the 

responsibility has not reached the top. 



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My father had raised us to think that, you know, 
there is due process. There's places that you start, and you 
move up, and eventually you'll get to a level that somebody 
will be able to help you. 

When several of the providers that I'm familiar 
with, when we've had problems, we started at the local level 
when you deal with your evaluators, and that's not successful, 
then you go to the next step up, which is their supervisor. 
And that wasn't successful, and then we went to the district 
manager, and that was not successful. 

And at that time, feeling very frustrated, several 
of the providers -- I'm real nervous here — but several 
providers had been closed down. You know, it's devastating 
when you lose your livelihood all in one day. 

And we're — you know, we have — these children 

that we're dealing with are severely emotionally disturbed 

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llchildren. The complaints that Mr. Gould's office will receive 

are all from either a disgruntled employee, or from a severely 

[emotionally disturbed child. 

Our employees, when they're upset with us, they 

don't go to the Labor Board or to Fair Employment. They go to 

Licensing, because they have a captive audience. And they can 

say whatever they want, and it is taken to be gospel. 

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When a Temporary — I mean a Request for Revocation 
was made against our agency, there were approximately 36 
allegations that were brought against us. However, when we got 
to the settlement conference, all of the other 33 had been 



97 
dropped and there were only three at that particular time. So, 
that is the process — I mean, that is something in the process 
that needs to change, in that people can bring allegations 
against you. The Department can use those allegations to close 
you down, and then later on say, "Oh, I'm sorry. Those weren't 
really true. We have a few others." And that's just not fair. 

The process is also so that if you do not have 
ijmoney, you cannot continue to compete, because many of the 
ijagencies that are here today have spent $10,000 and $12,000 in 
legal fees and have still been closed down. 

And despite public opinion, everybody, you know, 
we're making all this grand theft money. We don't have the 
money to be able to fight this Department. 

We went to Mr. Miller and talked with Fred Miller 
and literally begged him, "Please look at this situation. 
There's some problems." Maybe it's not you. Maybe it's those 
itthat are under you. We were not successful. 

At that time, after we went to the Senator's 
committee, and they arranged for a meeting with us, with 
Mr. Gould personally, at that time we brought to his attention 
my case and several others. And, you know, let him know at 
that time that we felt that Fred Miller was God; that he stood 
between us and our salvation because everything that he said 
fwas done. He could sign an order, and we could live; he could 

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'sign an order, and we could die. And that was so scary. 

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And we came to your Department. We sat at a table, 
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three providers and several other attorneys, and we begged you 
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at that time, "Please do something. We need your help." We 

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'didn't know what else to do. 

We received response from your Department, I guess, 

within maybe it took you about a month or so, because we were 

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waiting and just knew that we've reached the top here. We're 
going to get some help. 

We received a letter from your Department saying 
that you had looked into it, and that you felt that the actions 
that Fred Miller had taken were substantiated, and that 
concerns me. Because, people can come, and they can say 
[whatever they please about us, and we have no recourse. 

The only recourse we have is to spend money, which, 
if you close us down, we don't have the money. You don't have 
to even prove whether I molested a child or not, because I have 
no money to fight you. And that is scary. 

So, that's why I'm here today. If Mr. Gould 
receives his — I guess this is the confirmation hearing, or 
whomever, there has got to be some changes, because the 
children that we are dealing with, nobody else wants. You 
don't want them in your home. We're willing to take them into 
hours. They're severely emotionally disturbed children. They 
come from every background, and they are going to lie. And 
they're going to say whatever. And we have no recourse. 

And so, that's why I came to testify. 

SENATOR CRAVEN: We thank you very much for your 
testimony which was excellent. 

Senator Petris. 



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SENATOR PETRIS: I notice in one of the proposed 
actions that you're going to be taking, there's a statement 
that effective March 31, all TSO actions under consideration 
that have received concurrence from the Attorney General will 
then be reviewed by a Deputy Director. You've got some new 
procedures in place. 

My question is, under the current process, does the 
Attorney General do any independent investigation at all? Does 
the Attorney General send any staff into a facility to talk to 
the owner, operator, or staff, or patients before putting the 
stamp of approval on a TSO, or is that just kind of 
erfunctory? 

MR. GOULD: I think they review the case file, 
Senator, but I don't believe that there is a complete starting 
over of the investigation. 

I think what typically happens is that the 
investigation, initial investigation, happens at the licensing 
area within the field. At that point it goes to the community 
— to the Legal Division within the Department of Social 
Services, and they do an independent investigation. And then 
from there, they make determination if they believe it's 
appropriate to pursue a Temporary Suspension Order over to the 
Attorney General for their review of the case and the merits of 
it. And then at that point it would go to the Community Care 
Licensing Division. 

Two changes we think are important is, number one, 
to get more input from other people who may be involved with 



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that home, whether it's the schools, whether it's Mental 
Health, providers in the area, so we have a broader perspective 
about what's happening within that home and the overall 
environment of that home. 

SENATOR PETRIS: Yes, that sounds like a good step 
to me. 

It seems that in the cases we've heard about, there 
Was no communication from anybody, whether it was CCL, or AG, 
or anybody in between, or county. Where an official 
representative of the State Agency would come in and say, 
"Hey, we've been told this, and this, and that. What's going 
on in here anyway? Let's find out." 

Apparently, that hasn't been done. And what you're 
suggesting will see to it that that is done, I gather. 

MR. GOULD: Absolutely. We believe that more 
communication is appropriate. We believe that there ought to 
be information provided in writing to the providers. They 
understand about any complaints. 

I think only in circumstances where we might feel 
that the children or the clients are in such jeopardy if we 
would provide notice there might be -- 

SENATOR PETRIS: Some emergency. 

MR. GOULD: Right. But we want to change the 
method in which we provide input to the provider about any 
charges that are being made, and that would be in writing 
within ten days . 

MS. DOYLE: Can I say that the provisions that we 



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have, the regulations that are currently on the books, provide 
protection for us. 

The only problem is enforcement. As he read the 
TSO, that's not at all the way in which it is actually imposed 
[upon us. It is not as if — the only person in all — you said 
Jthe AG's office and all this -- the only person that we've ever 
seen would be an evaluator. The evaluator comes out, and they 
say that the abuse occurred. And it goes to the Legal 
Department. The Legal Department never comes and actually sees 
what's going on. They talk to maybe an employee that I fired, 
or to whomever they want. I am never, ever hardly consulted in 
this matter. 

And there books on -- there are laws that protect 
us. The only problem is, we have no way to enforce those laws. 

If Fred Miller decides to sign an order that is not 
substantiated, what can I do to him? Nothing. I could go to 
him, but when I did, again, what can I do if he doesn't 
respond? I can do nothing. 

So there needs to be some type of safeguard built 
into it that these -- that they are not God. That if they do 
not respond, and they do not do what the regulation says, that 
I can do something to them. Because right now, you know, they 
can do whatever they want. 

They can come today, and even coming here is scary. 
I said this to him before. When I came before and I testified 
to him about my -- the problems I was having, the fear or 
retaliation against -- from the Department. 



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Immediately I went home, and within two days, they 
were on my doorstep again and have continued to be so. And I 
would imagine probably by tomorrow they will be there. And I 
believe that, because it has continued to happen. 

There have been TSOs that have been issued because 
of non-adequate food. And when we get to the process, there 
was only five apples, and they were too small in your home. 

SENATOR PETRIS: If they come back in the next few 
days as a result of this hearing, would you let us know? 

MS . DOYLE : Yes . 

SENATOR PETRIS: I'd like to get a direct report 
from you — 

MS. DOYLE: My employee just said they'll be there. 

SENATOR PETRIS: — as to who it is and the nature 
of the questioning, and so forth. 

MS. DOYLE: Uh-huh, yes. 

SENATOR CRAVEN: They may be there in a productive 
isense, too. 

MS. DOYLE: With what? 

SENATOR CRAVEN: Productive sense. In other 
words, they may be helpful. 

MS. DOYLE: Yes, there is a first. That would be a 
first. 

[Laughter. ] 

MS. DOYLE: And that's what we're praying for. I'm 
serious. We're in this — my husband pastors a church in this 
|city, and this is also a ministry for us. And we are striving 



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to make some changes, but it's too stressful. 

Like I said, my father's in ICU. And in fact, last 
week when my father was taken to ICU, I was in my car, flying 
own Stockton Boulevard when my pager went off. And I pulled 
over to the side, ran into Trucadero and called. And my 
employee is saying, "Licensing is here." 

There should not be that much stress in addition to 
trying to deal with the stress of dealing with severely 

emotionally disturbed children, dealing with people at CCL that 

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at times seem to be SED. It's just not fair. 

SENATOR CRAVEN: Well, we all agree with you that 
it could be improved upon. 

MS. DOYLE: Okay. 

SENATOR CRAVEN: Thank you very much. 

Senators Beverly and Mello, do you have any 
questions? Nothing further. 

Does anyone else wish to speak in opposition? Yes, 
sir, come forward, please. State your name and address. 

MR. WILSON: Gary Wilson from Sacramento. 

In regards to one thing that Ms. Doyle said in a 
meeting that we had with Mr. Gould, we were told at that time 
— I was involved with one of the facilities that was -- had 
gone to Mr. Gould's office. A total of three of us had gone to 
speak to him regards to some of the problems that we were 
having. 

We were told, quote-unquote, "We can't talk to you 
right now because you're in litigation." 



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The response to that would have been, "You put us 
in litigation; you could take us out." 

A lot of the problems that we've got is that 
there's rules and regulations that are both in the Health and 
Safety Code, the Government Code, Welfare and Institutions 

Codes that already exist, yet the Department doesn't adhere to 

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them. The law states, including even on one of their own 

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pieces of paperwork, the law states that any deficiency that a 
facility has, they have to be notified in writing. 

Excuse me for being nervous . 

SENATOR CRAVEN: That's all right. Take your time. 

MR. WILSON: Has to be notified in writing of being 
in noncompliance and given time to adhere to compliancy. 

Yet the Department doesn't adhere to that, and 
there is no department that you can go to if CCL or DSS is not 
adhering to the rules and regulations. 

When we went to Mr. Gould, he turned around and 
said, "Well, we'll look into it." He gave it to his staff 
attorneys, of which I think there's 38, something like that. 
There's a great expenditure of money having 38 attorneys. 

SENATOR CRAVEN: With the problems that we've 
recounted here today, you can understand why you have 38, don't 
you? He's got in for 48 now. 

[Laughter. ] 

MR. WILSON: It would be okay if they even adhered 
to the regulations, but there's one attorney on Mr. Gould's 
staff that even went out and did an illegal deposition out of 



105 

the State of California. Government Code states that in order 
to do an out of state deposition, that you have to go to 
Superior Court in order to do it. This was not done. 

They took a disgruntled employee of ours that we 
had terminated. Our rates were cut back, and we had terminated 
him on — partially on that basis. They found him in the State 
of Nevada. Went and did an out of state deposition, which was 
done illegally according to the Government Code. And he 
admitted on a video tape that he had choked one of our 
residents, yet CCL ' s never turned around and done anything to 
prosecute that individual. They came after our company, but 
they didn't prosecute the person that stated that they had 
choked and hit a resident. 

SENATOR CRAVEN: Let's interrupt just a moment. 
May I ask Senator Petris, who's an attorney, do you 
have any thought about what Mr. Wilson's just recounted? 

SENATOR PETRIS: Yes, I think that's very serious. 
It should be looked into. 

MR. WILSON: Yes, I've got a — 
SENATOR PETRIS: I'm not familiar with those 
particular codes — 

MR. WILSON: Government Code 11511 states: 
"Where the witness resides outside 
the State and were the agency has 
ordered the taking of his testimony 
by deposition, the agency shall 
obtain an order of court to that 



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effect by filing a petition therefor 
in the superior court in Sacramento 
County. The proceedings thereon 
shall be in accordance with the 
provisions of Section 1189 of the 
Government Code . " 
The order was signed by Lonnie Carlson by somebody 
else within the Department. 

SENATOR PETRIS: That person's not a superior court 
judge, I gather? 

MR. WILSON: No, sir. He was a member of CCL. 
SENATOR CRAVEN: Well, of course, you wouldn't 
necessarily appear before a judge or in a court if you're 
giving a deposition. 

MR. WILSON: No, sir, but according to this, in 
order to do one out of state, it's required that you go to 
superior court . 

SENATOR CRAVEN: Yes, I understand what you're 
saying. 

MR. WILSON: Again, going back to the area of 
deficiencies, where someone is TSO'd, Senator Petris, if you 
picked up the phone right now, you could call Community Care 
Licensing and say you saw Joe Provider out at Montgomery Ward's 
parking lot beating a resident with a baseball bat, but I want 
to keep it as anonymous . 

We got together through a few different offices for 
Community Care Licensing. We went through and we accumulated a 



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book that they referred to as the Green Book at the Department. 
And what this was was a bunch of providers where we had 
everything from oral copulation among staff members in front of 
residents, to finding flies and maggots in food, all of this 
substantiated. The book is approximately this thick. 

There's two Senators here in the Capitol that have 
a copy of this, and if you need a copy, they'll be glad to 
provide it for you. 

All those facilities are still open, yet there's a 
Hot of providers that are out there right now with a lot less 



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SENATOR CRAVEN: Deficiencies? 

MR. WILSON: Deficiencies, thank you, that have 
been shut down. It seems like that a lot of facilities end up 
getting targeted, and once somebody gets targeted, that's the 
end of the story. 

They've used the media to close places down. One 
particular case, I don't have the code in front of me, but the 
codes require that if someone is going to get TSO'd, the 
placement agencies need to be notified. 

Well, Mr. Miller -- who, by the way, has no degree 
in anything other than an art degree, which I find being kind 
of obscure for somebody that's the head of Community Care 
Licensing working with adults, and Social Services, and all 
he has is an art degree. So, unless they stole a painting, I 
don't know what bearing he could have on a lot of things. 

But there's a lot of different areas that Community 



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Care Licensing basically is just not taking care of. They used 
the media in this particular case, like I said, and I don't 
have the code, but all they did was, they called five sheriff's 
cars out to this provider's residence and used it on the media. 
The flashed the gentleman's telephone — or, they flashed his 
car by orders of Fred Miller, "Go out to this man's hearing." 
They flashed his automobile on the television saying, "This is 
where he's using the money." 

Everytime we have brought issues to Community Care 
Licensing, it's been, "We will check into it," and then they 
never get back to you. And if you gentlemen know a government 
agency that we can look at or call when there is a problem, 
other than Social Services or Community Care Licensing, the 
providers are out there by themselves. If they do something 
wrong, they've got all the money; they've got all the time; 
they've got all the attorneys to be able to fight. 

The providers have no way to fight once they've 
been shut down. The law states that if you're shut down on a 
TSO, you have 15 days to file a motion for appeal. Then the 
hearing has to start within 30 days of that. 

I can give you at least a dozen cases, Senators, 
where once the hearing is started on the 30th day, they 
postpone it for 30 days, and they can drag it out for six, 
seven months before they're finally concluded. 

Now, I don't know what your budgets are like, or — 
well, you were an attorney, sir. You know what you guys 
charge . 



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SENATOR CRAVEN: He still is an attorney, and so is 
enator Beverly. 

MR. WILSON: Even if you're right, you can't fight. 

II 

And that's not the way the system is supposed to be set up. 

So many people that want to be able to fight, the 
Department has taken away their ability to even do so. And the 
bnly ones that are suffering are the kids and the mentally 
disabled people and the elderly that are out there. 

SENATOR CRAVEN: Mr. Wilson, do you live in 
Sacramento? 

MR. WILSON: Yes, sir. I'm a former Los Angeles 
bolice officer. 

SENATOR CRAVEN: Congratulations. 

The gentleman who represents you would be Senator 
Leroy Greene? 

MR. WILSON: Yes, sir. 

SENATOR CRAVEN: Have you ever brought this to 
Senator Greene's attention? 

MR. WILSON: Yes, sir. They've been working — 
they've been attempting to work with Mr. Gould for about the 
last five or six months on this issue. 

SENATOR CRAVEN: Are you familiar with that, 
Mr. Gould? 



is — 



MR. GOULD: I'm familiar with the Green Book. That 

MR. WILSON: LKM Group Homes? 

MR. GOULD: I didn't know which homes you were 



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with. 

We did an extensive review of that. There was a 
book that was produced that is quite thick — I think that was 
an accurate description -- and in that, there were some homes 
in which the question was whether the homes were being treated 
appropriately and consistently in terms of their review. 

I established an independent task force to take a 
look at that. I brought in staff members from the Agency as 
well as an attorney who's well respected in the community that 
works in Community Care Licensing and knew those law, as well 
as John Healey, who is the interim Director of the Department 
of Social Services, to take an independent look at these and to 
see if they felt there were problems in terms of how actions 
were taken, whether there was consistency. 

And upon that review, they reported back to me and 
shared that they found that there was appropriate actions 
taken, and they verified it. 

To clarify, a number of those other homes, it was 
stated that they were not shut down. A number of the other 
homes were also closed where they revoked their license, or 
they basically declined to keep operating because there were 
serious problems in those facilities. 

I think -- we also took the opportunity then to sit 
down with the Senators who were most interested, who had 
expressed an interest in this issue, to share with them the 
findings, and we offered to meet with all of the providers who 
had raised a concern regarding these issues, to share the 



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findings so that we could explain it to them. That offer was 
not accepted. 

So, we have taken this very seriously, and that's 
been our approach. 

SENATOR CRAVEN: Well, I get the impression from 
hat you say that you feel that there was a lot of correctness 
to what Mr. Wilson has said, and you have set about to try to 
get some complete and total understanding in an unbiased 
manner. 

Would I be correct in assuming that there's still 
work that may be done to assuage the problem which he has 
recounted? 

MR. GOULD: Yes, sir. 

I think when we talk about the nine changes we're 
imaking, I think those go a long ways towards remedying some of 
the concerns that have been expressed. And we're on the path 
to implement a number of those. As I mentioned, a number of 
those will be implemented March 1st. 

SENATOR CRAVEN: Very good, thank you, sir. 

MR. WILSON: How does that affect the homes that 
have already been shut down because all at once your Department 
sees that the regulations needed to be updated? What does that 
do to the homes that have already been shut down? Is there 
going to be a reconsideration for those homes? 

SENATOR CRAVEN: Yes, if you would respond, please. 

MR. GOULD: Sure. 

I think in those situations, you mentioned LKM in 



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particular, I think that there were full hearings before an 
administrative law judge where they did a review and, I 
believe, the hearings went for 13 days, where there was full 
opportunity for everyone to present an independent body what 
their perception of the situation was, to get a fair hearing. 

And in that situation, the administrative law judge 
jsided with the Department of Social Services and basically said 
that the action taken by the Department was appropriate. 

So, I wouldn't see going back and trying to reverse 
an action in which an administrative law judge has made that 
determination . 

MR. WILSON: Even though the administrative law 
judge is contracted through your Department? 

SENATOR CRAVEN: Well, the administrative law judge 
is in a position where, really, he can do — he makes the 
decision as to what he thinks is appropriate. The Legislature 
really has no rebuttal to the administrative law judge. 

MR. WILSON: Okay. 

SENATOR PETRIS: Mr. Chairman. 

SENATOR CRAVEN: Yes, sir. 

SENATOR PETRIS: Unfortunately, I'm going to have 
to run . 

I wondered if — there are other questions I want 
to go into on the nuclear waste problems. 

SENATOR CRAVEN: Yes, sir. 

SENATOR PETRIS: And I'd like to shorten it by 
submitting some questions in writing and asking Mr. Gould to 



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answer them, and have this put over to a week or two, maybe a 
couple weeks. 

SENATOR CRAVEN: Very well. Would it — 

SENATOR PETRIS: There's also interaction between 
his shop and the Health Department. 

Now, you might be getting bashed here for things 
that the Health Department should have done in radioactive. 
So, there's similar questions I'd like to put to the nominee, 
Dr. Coye, so there's overlapping things there. I think it'll 
help us make some kind of recommendations for resolving the 
nuclear waste things. 

SENATOR CRAVEN: Very good. 

Let's make a determination right now that we'll put 
the matter over for a period of two weeks. 

MS. MICHEL: I was wondering, Senator Petris, maybe 
we should do it at the same time we do Dr. Coye. That's in 
three weeks . 

SENATOR PETRIS: Yes. Does that put him in 
jeopardy on the time? He started in April, I understand. 

When did you start? 

MR. GOULD: I believe it was April 16th. 

MS. MICHEL: That's a month in advance. 

SENATOR CRAVEN: That's enough time. 

SENATOR PETRIS: I don't want to push you right up 
against a deadline. 

SENATOR CRAVEN: No. 

SENATOR PETRIS: Thank you very much, Mr. 



Chairman 



114 



SENATOR CRAVEN: You're entirely welcome. 
Have we now heard from all of those people in 



objection? 



MS. MICHEL: No, you have other people here. 

SENATOR CRAVEN: We have others? 

MS. MICHEL: There may be one or two more. 

SENATOR CRAVEN: I don't like to have you appear 
before a short committee, which we are now, Senator Beverly and 
myself . 

What do you feel, Bob? 

SENATOR BEVERLY: Let's inquire how many there are. 
I didn't see that many hands go up. 

SENATOR CRAVEN: We're back to normal now; we've 
got three . 

There's this gentleman in the front row, and there 
appears to be just one that we have seen. There's another one; 
there are tow. 

Why don't we proceed with those people. Senator 
Mello, these are still people in objection. There appears to 
be two more left. 

What we have done is set the matter over for a 
period of three weeks, and we can just proceed, if it's 
agreeable with you. 

SENATOR MELLO: I think we ought to hear everybody 
that's here today so we can just put it over. 

SENATOR CRAVEN: Absolutely. I agree with you. 



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You two are going to have to fight it out. I don't 
know which of you was here first. He's bigger. 

MR. HAUSEY: I'm Willie Hausey. 

I'm here in support not as an opposition. 

Let me say here that I think a lot of work has to 
be done in this area. And one of the things providers don't 
have is rights. Doctors have rights; lawyers have rights. 
Providers don't have rights. 

One of the things we need to work on is a system 
that gives providers a right to operate a facility, just like a 
doctor operates his office. If he makes a mistake, malpractice 
is filed against him. He still goes on with his business. 

Somehow, we have to take a closer look at 
providers, as now they are up in a professional level, as we 
used to look at them as care providers . They are now 
residential care providers. They are professional people, but 
the regulations haven't moved along with the professionalism 
that these providers are doing now. 

I have worked closely with this man here, Mr. 
Gould. I have worked closely with the Department. And I have 
a good rapport; the organizations I represent have a good 
rapport . 

We need to, as associations, get together, put in 
some legislation to do exactly what we want, and have this man 
to enforce it. I don't think that we are talking about what he 
can do now as much as what we need to do in the law. 

We have several bills laying around that we need to 



116 

put some amendments in, but we as representatives of those 
providers and providers have a job cut out, and we need the 
support of Mr. Gould and yours to make sure this will work. 

And I ' m here . 

SENATOR CRAVEN: Thank you, Mr. Hausey. 

Next gentleman, please. 

MR. JOHNSON: Thank you. My name is James T. 
Johnson, III, and I am the President of AMARCH, which is the 
Association for Minority Adolescents in Residential Care Homes. 

We are basically taking a position that we're not 
pposing his confirmation, but we do have some concerns that we 
would like to address. 

SENATOR CRAVEN: Fine. Why don't you express 
those. 

MR. JOHNSON: Our first concern is, we've heard 
this over and over again, has to deal with the appeals process. 

We feel that the appeals process needs to be restructured to 

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fmake it accessible to providers. And I'm sure this is just a 

reiteration of what a couple other people have said before me. 

Under the current structure, only one percent or 
less can afford to appeal after they've been closed down. 

Also, that a process should be implemented to 
address the complaints against the Department staff, because as 
it is, many providers have placed complaints against Department 
employees, and they feel that the Department has not basically 
acknowledged their complaints, or looked into it and gave a 
concerted effort to address their concerns. 



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Also, I would like to request that the Rules 
Committee inquire to the Agency as to their position with 
respect to institutionalization of our children versus 
community-based programs. We would like to know, basically, 
where they stand and what do they feel about community-based 
programs . 

Also, our membership is having a very difficult 
time dealing with the current rate setting system. This 
system, the way it is sets up now, it penalizes providers who 
cannot maintain higher than a 90 percent occupancy rate. So, 
if the providers — and this is due to no fault of their own — 
if they cannot maintain at least 9 percent of occupancy rate, 
they're then being told that they have to pay back these funds 
to the Department of Social Services. And since the program is 
already experiencing financial constraints due to the lack of 
placements, then I can ill imagine that how they're going to be 
able to have the capability to pay back these funds. 

We feel that our concerns are so vital to our 
ability to properly address the needs of our children that we 
are willing and would like to set up a meeting with Mr. Gould 
or the interim Director, John Healey, to address these 
concerns . 

CHAIRMAN ROBERTI : During the three-week interim, 
before we take up Mr. Gould's confirmation for a final vote, 
I'm sure Mr. Gould will be happy to meet with you. 

MR. JOHNSON: One last thing. 

I think that there should be something established 



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that would allow the Department to look into these providers 
that have been closed down that have not been afforded due 
process. And basically in conjunction with their Technical 
Assistant Unit that Mr. Gould has mentioned, to work with these 
providers. And if due process was not administered to these 
facilities, to allow them to obtain their licenses. 

I do believe that we can show in many cases that a 
lot of the providers sincerely attempted to address the 
concerns of Community Care Licensing, but Community Care 
Licensing has demonstrated over the past a very biased 
perspective with providers in the job that we have. 

I also think that with respect to Community Care 

Licensing, that an affirmative action program, especially 

speaking about minority males, we should have more evaluators , 

since a disproportionate amount of children that are serviced 

in this state are African-American males. And I think a lack 

i 

of cultural sensitivity is evident here when we're speaking of 

Community Care Licensing and their beliefs. And I do believe 

that it is a mind-set of Community Care Licensing that stems 

from the Deputy Director Fred Miller on down, because these 

practices that they are currently doing to providers, they've 

been doing for many years. It's just recently that people have 

started to speak up and just not take the abuse. 

That's all that I have, sir. 

SENATOR CRAVEN: Thank you, sir. 

CHAIRMAN ROBERTI: Are there any other witnesses? 

SENATOR CRAVEN: Mr. Chairman, I think that that 



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concludes the witnesses in opposition, but there are some of 
those here in favor. 

CHAIRMAN ROBERTI: Yes, please come forward. 

MR. SEATON-MSEMAJI : Mr. Chairman and Members, my 
name is Ken Seaton-Msemaji, representing the United Domestic 
Workers of America. 

A few minutes ago when a young lady was testifying, 
and she suggested that if she got some cooperation out of the 
Department, it would be a first. 

Well, I want to tell you about our first. For 
years, the Department of Social Services has been as hostile as 
we've heard described here today and worse in the home care 
area. They have, in our judgment and experience, many times 
abused the regulations and laws that exist, have gutted quality 
from the program, have lied to committees of this Legislature, 
and much, much worse. Very, very hostile. Never any 
flexibility or open-mindedness, and that went on for a long, 
long time. 

Many of you will remember that we would come to you 
every year at the beginning of budget time, complaining about 
the preposterous proposals about cutting home care that, if 
were ever enacted, would have raised the cost, not lowered the 
cost. And we didn't come to all of you during the year, but we 
would come to Senator Mello and sometimes Senator Craven with 
smaller items of a similar kind of a nature. And that just 
went on and on and on, year after year. 

Then Mr. Gould came in and brought his people in. 



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And I have to admit here today that there ' s been a drastic 
jthange. Our ideas are welcome there now. The accessibility of 
Mr. Gould and the people working under him is enormous. We get 
a serious and honest consideration of our ideas and opinions. 

We've worked through several problems that just a 
couple of years ago, we would have had to battle through, and 
then come to you all to save us. 

What we have now is people, the acting Director, 

who comes out. He went to San Mateo County. Spent hours and 

jhours talking to representatives of provider companies. 

Talking to home attendant employees. Talking to client 

recipients, both disabled and elderly, to see what it is that 

jthey ' re really experiencing. Taking the time to learn, 

[(soliciting ideas and so forth. There is a night and day 

difference with regard to in-home supportive services in that 

Department since Mr. Gould and his associates have taken their 

positions . 
I 

Some of the same people who were there before that 

conducted much of what we consider the unacceptable behavior, 

some of those people are still there, but they behave very 

'jdif ferently now. 

And so, we are here to offer our support in 

^confirmation. Mr. Gould did not ask me to come forth on his 

behalf. He did not ask me to write a letter. When I found out 

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lit was coming up, I thought it was important enough to come 

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ibefore you, because it is a day and night difference. 

And you may notice that we haven't been around to 



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bother you all as much in the last year or so as we normally 
do. 

So, we ask for your positive consideration. Thank 
ou. 

CHAIRMAN ROBERTI: Yes, Senator Mello. 
SENATOR MELLO: I don't have a question, but I 
think he brings up an interesting point. 

I don't think it was established. Mr. and Mrs. 

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iDobson are still here. I want to ask them, when did this 

[incident happen in your group home? Was it before Mr. Gould 

came aboard? 

MS. DOBSON: November 24th, 1990, when the incident 
happened and the lady was taken to the locked facility. 

SENATOR MELLO: So it was in 1990. 

MS. DOBSON: Then the facility's TSO was January 



25th, 1991 



of '91. 



SENATOR MELLO: He got appointed, I think, in April 



Mr. Stevens who was here earlier, I think he 
mentioned something about the 4th of July. I guess he's gone 
already. I failed to ask whether or not it was the 4th of July 
of '91 or of 1990. 

FROM THE AUDIENCE: It was '91. 

SENATOR MELLO: So, that's during the time Mr. 
Gould was then there. 

Thank you very much. I just wanted to get 
established that at least as you pointed out, you've 



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experienced a negative relationship with the Department before, 



and now he ' s turned that around 



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And the Dobson's incident, I guess, happened before 
Mr. Gould took over as Secretary of the Agency. 

SENATOR CRAVEN: On somebody else's watch. 

MR. SEATON-MSEMAJI : Senator, it may be important 
jto add that the Department nor the Agency agrees with us on 
tevery single thing, but what we get now that we didn't get 
before is an honest consideration, an opportunity to vigorously 
debate and pursue our point of view, and they're inclined to 
try to find ways to make things work, and to try to find ways 

to be flexible and give the benefit of the doubt. 

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But they don't roll over and play dead. They're 
just reasonable. And before, we couldn't get any reasonable 
response ever in years . 

SENATOR MELLO: Thank you. 

CHAIRMAN ROBERTI: Thank you very much. 

Is there anybody else who wishes to testify? 

Then, Mr. Gould, we'll let you conclude, 
understanding you get to come back again. 

MR. GOULD: Well, I think we've had a thorough 
discussion of the issues, and I'll look forward to joining you 
in three weeks . 

CHAIRMAN ROBERTI: Very good, thank you. 

We will reset this hearing in three weeks for 
limited testimony and the vote. 

Thank you. 



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MR. GOULD: Thank you. 
CHAIRMAN ROBERTI: And we're going to break again. 

[Thereupon a brief recess was taken.] 
CHAIRMAN ROBERTI: The Committee will come to 



order. 



We have before us two more gubernatorial 
confirmations, and the first of these is Kenneth M. Keller, 
Chief of the Bureau of Electronic and Appliance Repair. 

Mr. Keller, we will ask you what we ask all the 
Governor's appointees, and that is why you are qualified to 
assume this position. 

MR. KELLER: Thank you, Senator, Senators. I 
appreciate the opportunity to tell you a little bit about that. 

I've provided everybody with a written statement 
that goes into a little bit of detail about the Bureau and 
about myself, so I'll try to summarize in the interests of 
time. 

This is my first job in government. I've been in 
the private sector for the first 40 years of my life. I moved 
to the State of California from Michigan in 1983. I've been in 
the printing business for most of my adult life. 

Most of the time in the printing business, I've 
been in the small business end, businesses of $5 million annual 
gross or less; businesses with 50 employers or fewer. And as a 
result, I've learned to wear many hats in trying to accomplish 
itasks that need to be done. I've been a salesman. I've been 
sales management. I've been in labor relations. I've been in 



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new product development. I've been in customer relations. 

This experience has served me well to be part of 
Jim Conran ' s team in the Department of Consumer Affairs. 

I think you've heard a lot of testimony from Jim 
about what the aims of the Department are, and I just want to 
treiterate and reconfirm that our Bureau, which is charged with 
enforcing the laws dealing with the repair of consumer 
electronics and major home appliances, is dedicated to strict 
enforcement of the law, aggressive enforcement of the law, and 

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trying to be ahead of the consumer electronics market which 

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changes dramatically from year to year, such that we have items 

that are on the consumer market that are not covered by our 

statutes, and we statutorily cannot investigate and mediate 

complaints. We're working on legislation right now so that 

that can be remedied and we can become current with the market. 

Under Jim's leadership, we will continue to try to 

find ways to be ahead of the market rather than always catching 

up behind it. We've — you might be interested to note that 

my predecessor was appointed by Governor Ronald Reagan in the 

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'last part of his term, and I don't know whether you've had a 

nominee for this position come before you in a long time. So, 

a lot of things have happened in this fields that we'll work 

very hard to try to change . 

We're trying to increase enforcement as 

dramatically as we can with the resources that we have, and to 

try to look into new areas that are important for consumers . 

And the area that — two areas that we've been charged to take 



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a look at include whether there should be certification of 
technicians who do the repair work in the State of California, 
and whether there should be stricter enforcement of the 
disclosure laws and other problems in the service contract 
area. 

Service contracts are currently about a billion 
dollars' worth of -- they're about a billion dollars' worth of 
([service contracts sold in the State of California per year. 
JThere have been a number of bankruptcies of companies that have 
been selling these, possibly because of pawnsey [sic] schemes 
or pyramid schemes that have — that's what's bilked consumers 
out of money, promising to make repairs and then disappearing 
with the money. 

There are also problems with the enforcement of the 
disclosure laws. Consumers don't know their cancellation 
rights. They don't know their rights -- other rights under the 
contract which the law provides. 

And we are moving very aggressively to remedy those 
situations, to seek statutory authority to enforce the laws 
that are on the books to protect consumers in these new areas 
that have come up in the '80s and '90s in the Department of 
Consumer Affairs. 

I think I'll conclude there. That is the main 
thrust of what the Bureau is going to be doing under Jim's 
leadership. 

Just maybe — just finally to remark that we are 
part of a team, and we're working very closely with Jim and the 



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126 
leadership in the Department to make sure that we have put the 
word "consumer" back in consumer protection. 

CHAIRMAN ROBERTI: Thank you. 

Are there any witnesses in support or opposition? 
Any questions? 

SENATOR CRAVEN: Move Mr. Keller. 

CHAIRMAN ROBERTI: Senator Craven moves Mr. Keller, 

You're going to get off easy, Mr. Keller, or we're 
tired. 

[Laughter. ] 

MR. KELLER: I hadn't noticed that, Senator. 

CHAIRMAN ROBERTI: Secretary will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote is four to zero; 
confirmation's recommended to the Floor. 

Congratulations . 






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MR. KELLER: Senators, I appreciate it. 

CHAIRMAN ROBERTI: The next confirmation is that of 
Mr. James R. Schoning, Chief of the Bureau of Automotive 
Repair, Department of Consumer Affairs. 

MR. SCHONING: Senators, I'm pleased to be here 
before you. 

I'm also mindful that I am all that stands between 
you and your evening plans . 

[Laughter. ] 

CHAIRMAN ROBERTI: That's right. We'll get you out 
of here real quick, one way or the other. 

[Laughter. ] 

CHAIRMAN ROBERTI: Why don't you tell us why you 
feel you're qualified to assume this position? 

MR. SCHONING: Thank you. 

I began my career here what seems like only 
yesterday, working for the State Legislature in 1969. I had 
the privilege of serving as Chief Administrative Officer in the 
Assembly, and then as Assistant to the Minority Leader as 
things changed. And for the last 15 years, I've been on the 
staff of the Coro Foundation, which is, as many of you I think 
know, is a nonprofit, nonpartisan organization which 
specializes in training citizens for more effective public 
service careers. 

In addition to serving Coro for more than 10 years 
in California, I had the opportunity to help Coro begin its 
operations in New York City for the period from 1983 to 1988. 



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In both New York and Los Angeles, I — my responsibilities were 
to work with culturally diverse men and women of all ages who 
were seeking, again, to learn how they could make a more useful 
contribution. My job was to help them learn how the various 
legitimate sectors of our society work together, what their 
needs are, and how you can get members from each of these 
sectors to see how their own self-interest is tied to the 
health of our society as a whole. 

I think this experience is proper qualification for 
my present responsibilities, if you concur that I be Chief of 
the Bureau of Automotive Repair. 

I might say, I'm honored to serve on a team that 
the spirit has been set by the Governor who appointed me, and 
our Agency Secretary, and our Director, from whom you've 
already heard. 

I hope that five initiatives which we've already 
begun to work on would give you some indication of where we 
think we're going with the Bureau. First, there's no doubt 
that over the past eight years, at least, management of the 
State Smog Check Program has been the BAR'S top priority. And 
as the federal government makes known the details and 
regulatory aspects of the 1990 Clean Air Act amendments, we 
promise to work closely with each of you on whatever changes, 
if any, are going to be required to the state's Inspection and 
Maintenance Program. 

I believe we've made a solid beginning in the 
relationships that will be necessary for us to move ahead in 



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129 
that respect. We're working closely with the Legislators, with 
the principle legislative author of that program, who is 
Senator Presley, and with the Legislature's own inspection and 
maintenance review committee, with the automobile repair 
industry, as well as with the broader business community which 
has a stake in clean air as well. We're, I believe, in good 
contact with environment groups, other state agencies like the 
Air Resources Board, organizations at the federal level, the 
Environment Protection Agency, and so forth. 

A second area of our responsibility and our chief 
responsibility, again, is to put consumer protection back into 
the flag of the BAR the way it was before the Smog Check 
Program came along and dominated the organization's attention 
for the last several years . 

Given the continued dependence Californians have on 
the automobile, as resources are shrinking for other priorities 
as we've heard this afternoon, we believe we have to do a lot 
more to assure citizens at least of a fair and reliable 
marketplace when it comes to automobile repairs. As Director 
Conran indicated, we're doing this through a more aggressive, 
more visible enforcement. One small example, we've initiated 
124 disciplinary actions during the first six months of the 
present fiscal year, in contrast to 113 over the entire 
previous fiscal year. 

We think we need to send a clear message to those 
who victimize motorists that we will not tolerate their illegal 
behavior, and we will not allow them to damage the reputation 



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130 

of the honest small business men and women in the repair 
industry. 

A wise man once said that we should never 
underestimate the intelligence of the American people, but we 
should never overestimate their supply of information at any 
given point in time. And at least as important as the first 
two themes we've adopted is the third, and it's even more 
difficult, and that's the whole question of public awareness: 
reaching motorists who have the -- and getting them the 
information they need to protect themselves in the marketplace, 
and recruiting them to be our partners in our consumer 
protection and our air quality efforts. That's why we 
publicize our enforcement, why we communicate in multiple 
languages through our publications, our toll-free telephone 
numbers, and why we conduct a wide variety of public education 
awareness activities. 

I know time is short, but I have to share with you 
a fourth area of concern. I'm afraid it's not unique to the 
automobile repair industry. The technology of our new cars has 
overtaken the professional skills of many of those who earn 
their livings in the industry. California needs skilled 
repairmen, both to give reliable repairs and to help clean the 
air. 

As with other challenges to our workforce, we don't 
have any overnight miracles to announce to you today, but we're 
trying to serve as a catalyst to help the repair industry in 
its struggle to update its skills and attract young men and 



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women with the science and the math and the electronics that 
are required to work on today's computer-controlled cars. 

Finally, we're organizing ourselves internally for 
the future. As a state agency, we're fortunate to have a 
[wonderful set of employees who enjoy what they do. They do it 
Well, and they believe very deeply in our mission. And we're 
incorporating the principles of total quality management that 
are aimed at keeping that drive for excellence moving forward. 

Even at this hour, I'm hoping you can see that I'm 
excited with this opportunity, and I'm grateful to be before 
you. I look forward to working with you, and I ' d be happy to 
answer any questions you might have. 

CHAIRMAN ROBERTI : Are you thinking of initiating 
any programs to keep auto repair people up to date on 
technology? I didn't quite catch -- 

MR. SCHONING: I didn't give you the solution to 
the problem. 

CHAIRMAN ROBERTI: It may be insoluble. 

MR. SCHONING: We're working on a wide variety of 
fronts. We're trying to — the long-range solution is how do 
we reach young people when they're deciding what they want to 
be when they grow up, and how do we attract those kinds of 
folks into the industry in the first place. 

I think there's a good living to be earned out 
there for those who get the proper preparation, but it's no 
longer just grab a monkey wrench. So, we need to reach young 
people . 



132 
We're also working very closely at the other end of 
|the scale with people my age who are looking at a very 

different automobile than they were 20 years ago when they came 

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into the business. We're working with the industry to get 

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(additional training through federal grants . The Environmental 



Protection Agency has some monies available to help implement 

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educational aspects of the Clean Air Act. And our own 
'Employment and Training Panel has made funds available for 
training to the automotive repair industry in the past, and 
we're attempting to be a broker and a catalyst in that effort 
again. 

Beyond that, we're convening representatives of the 
repair industry, and the education fields, and anyone who will 
come and join us, the auto clubs, anyone else from the consumer 
[movement, the environmental movement, who sees that sooner or 
later, it's automobile repairs that — that fix the cars, and 
that's what cleans the air. 

So, we're doing our best. We're eager to hear any 
new solutions and ideas. 

It's a tough nut. It's no easier or more difficult 
than all of the other challenges that face our public education 
and our workforce. 

CHAIRMAN ROBERTI: Are there any questions? 

Is there anybody here in support or in opposition? 

SENATOR CRAVEN: Move Mr. Schoning. 

CHAIRMAN ROBERTI : Senator Craven moves . 

SENATOR BEVERLY: Mr. Chairman, you and I remember 



133 



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Mr. Schoning as the CEO. I think he was reasonably responsive 
in those days; wasn't he? 

CHAIRMAN ROBERTI: That's right. 

SENATOR BEVERLY: It's been so long, I've 
forgotten. 

I'll join Senator Craven in moving the approval. 

SENATOR CRAVEN: Senator Craven moves. Secretary 
will call the roll. 

SECRETARY WEBB: Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. 

Senator Mello. 

SENATOR MELLO: Aye. 

SECRETARY WEBB: Mello Aye. 

Senator Petris . Senator Craven. 

SENATOR CRAVEN: Aye. 

SECRETARY WEBB: Craven Aye. 

Senator Roberti. 

CHAIRMAN ROBERTI: Aye. 

SECRETARY WEBB: Roberti Aye. 

CHAIRMAN ROBERTI: The vote is four to zero; 
confirmation is recommended to the Floor. 

Congratulations and good luck. 

MR. SCHONING: Thank you, sir. 

[Thereupon this portion of the 
Senate Rules Committee hearing 

was terminated at approximately 

5:45 P.M. ] 

— ooOoo— 



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134 
CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of 
the State of California, do hereby certify: 

That I am a disinterested person herein; 
that the foregoing Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel 
or attorney for any of the parties to said hearing, nor in 
any way interested in the outcome of said hearing. 

IN WITNESS WHEREOF, I have hereunto set my 
hand this Q<: day of March, 1992. 




EVELYN J. XIZAK 
Shorthand Reporter 



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